Transcripts of the monetary policymaking body of the Federal Reserve from 2002–2008.

Thank you, Mr. Chairman. Well, so far it looks as though our decision to pause at the last meeting was a sound one, and I emphasize “so far” because we obviously have not received a lot of additional information. I think the reaction in the financial markets has been encouraging in that, as best as I can judge, the news was received that it is a sensible decision, inflation expectations have remained well anchored, and so forth. My take on the incoming data has not changed my view of the decision to pause last time, which I favored, and I think we are well positioned at the moment, especially when we continue to allow for the lags presumably stemming from our previous actions. So I favor staying where we are today.

As far as the language is concerned, I favor the language of alternative B, as written. Vince indicated that perhaps financial market participants did not quite receive the message, but I thought the message was fairly clear. It talks about “any additional firming,” which is quite explicit and allows, as far as I can see, flexibility if we need it to go in the other direction with the last phrase in the risk assessment in section 4. So I am comfortable with the language and think that at this stage we should just stay where we are.

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