1. Forward Guidance – The role of forward guidance should be limited; transparency in communication regarding future policy decisions is not an end in itself; excessive sharing of policy discussions and over-commitment to future decisions can mislead markets, businesses, and households.
2. Inflation – It is essential to be certain that underlying inflation is moving toward the target, otherwise “there is still work to be done”; inflation data do not show a significant improvement in the trend; medium-term inflation expectations remain generally stable.
3. Economy – The likelihood of significantly higher economic growth is increasing; Main Street and Wall Street have shown remarkable resilience; the labor market is quite stable.
4. Policy Objectives – The Fed’s 2% PCE target is a firm, fixed objective; the Fed’s primary focus should currently be on prices.
5. Interest Rates – The credit and lending markets show little sign of policy tightening; current financial conditions are not restrictive, and interest rates are the Fed’s “primary tool” for fulfilling its mandate.
6. Artificial Intelligence – Artificial intelligence is a new variable that will impact the economy and policy implementation.
7. Reforms – Early communication with the leaders of the various working groups is encouraging.
