Mr. Chairman, I am very comfortable with our current stance at 5¼ percent. I think that it is, as I have said before, modestly restrictive and that it will take us over time to a lower inflation rate.
On the statement itself, I have a couple of comments. I am a little uncomfortable with the language used in the output rationale because we use the term “moderate” to describe growth for the first half of this year and coming quarters and this suggests that there will not be much change in growth going forward as we use “moderate” in both places. So I would like, if we could, to have something in there that will describe the pickup in activity from the second quarter on that we have talked about. This would improve the characterization. That is just a suggestion. I know how hard it is to craft these things, but it is something to think about.
On the inflation rationale, I’ll make two points. One, I think the statement carries pretty well—that is, inflation has come down recently, but we are not yet confident that progress will be maintained. Two, on a twelve-month basis, core inflation is higher than I find acceptable over the longer term, and would like to see further progress toward price stability. Perhaps President Fisher’s suggestions would take us closer to my preference in terms of something more explicit that promotes further progress in reducing inflation. That would improve the statement. But, as I said, crafting these things is pretty difficult. I can live with the language as it is, and those are just suggestions to think about as we go forward from here. Thank you.