Fed minutes reveal debate over forward guidance
Some FOMC members warned stronger forward guidance in new framework would tie Fed’s hands
Federal Open Market Committee members differed on how best to communicate their commitment to their new average inflation targeting (AIT) framework, the last meeting’s minutes show.
The September 15 to 16 FOMC meeting was the first since the Fed adopted AIT. Most FOMC members ultimately backed “enhanced” forward guidance that stated the Fed expected to leave the policy rate at the effective lower bound until inflation had run “moderately” above target for “some time”, and “maximum employment”
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