Federal Reserve chair keeps rates steady, launches five policy task forces and vows to "deliver price stability"

The Federal Reserve chair told reporters the Federal Open Market Committee decided to keep the target range for the federal funds rate at 3.5%–3.75% and reaffirmed the central bank’s policy of maintaining ample reserves. The chair said the committee was "unambiguous and unanimous" in its commitment to deliver price stability.

The chair announced the formation of five task forces — on Fed communications, the Fed’s balance sheet, data sources, productivity and jobs, and inflation frameworks — and said he was enlisting experts from inside and outside the economics profession to review first principles, current practices and possible reforms. "Start with first principles, ask hard questions, examine current practice, consider alternatives, and ultimately propose next steps for policymaker consideration," he said.

The chair summarized participants’ median economic projections included in the SEP: real GDP growth near 2.2% next year, core PCE inflation at about 3.6% this year and 2.3% next year, and an unemployment rate around 4.3%; the median gauge of the appropriate federal funds rate was 3.8% at year-end. He added that he did not submit his own forecast.

On the balance-sheet review, the chair said the task force will assess the benefits and risks of the current ample reserves regime and consider alternative frameworks for the conduct and operation of monetary policy. The data task force, he said, will evaluate new information sources and methodological changes designed to give policymakers more accurate, timely and actionable information about economic conditions.

The chair described the task force on productivity and jobs as charged to study the pace and economic impact of general‑purpose technologies, including artificial intelligence, and to explore implications for the Fed’s employment and inflation mandates. The inflation‑framework task force will examine drivers of inflation and weigh options for delivering price stability in a changing economy.

The chair said he expected recruitment for the groups to conclude soon, work to begin within weeks, initial framing to emerge in the fall, and for most task forces to aim to finish by year‑end. He framed the initiative as a "fresh look" intended to make the Fed "fit for purpose" in the years ahead.

The committee’s decision to hold the rate and to keep ample reserves was presented as a consensus judgment; the chair emphasized that future changes will depend on incoming data, and said the FOMC will meet again in six weeks.