and farmers received so much support that saw them regain more jobs than expected through August. For that reason, “the absence of further fiscal support would exacerbate economic hardships in minority and lower-income communities,” the minutes said. During the meeting, members also moved to incorporate recent changes on the Fed’s approach to inflation, and what it would take to justify rate hikes in future. Markets have been seeking for enhanced forward guidance on what particular benchmarks the FOMC would deploy as criteria. However, members agreed that the new language indicating a target of inflation averaging above 2% for a period of time would be enough. “Most participants supported providing more explicit outcome-based forward guidance for the federal funds rate that included establishing criteria for lifting the federal funds rate above the [current level near
zero] in terms of the paths for employment or inflation or both,” the minutes said. “However, with longerterm interest rates already very low, there did not appear to be a need for enhanced forward guidance at this juncture or much scope for forward guidance to put additional downward pressure on yields.” In the past, the Fed had described its inflation target as being “symmetric,” meaning that it would go above or below the 2% target. The new description makes it more straightforward that the Fed is targeting at least 2% inflation. Work cited. https://www.cnbc.com/2020/10/07/fed-minutes. html#:~:text=Federal%20Reserve,Fed%20officials%20 worried%20that%20lack%20of%20help,will%20threaten%20 recovery%2C%20minutes%20show&text=Federal%20Reserve%20officials%20at%20their,aid%20would%20 decrease%20or%20disappear.
