00:08This morning, the FOMC decided to maintain the target rate for the federal funds rate
00:13at 3.75% to 4% in support of the Federal Reserve's dual mandate.
00:20Economic activity is expanding at a strong pace.
00:23While uncertainty remains, owing in part to geopolitical developments, domestic spending
00:30has been resilient, productivity growth is strong, and capital investment robust.
00:37Job gains have kept pace with the workforce, and the unemployment rate has changed little,
00:43but inflation remains elevated.
00:46The Committee believes that the accumulation of more information will help it determine
00:52the policy stance appropriate to ensure a timely return of inflation to the 2% goal.
00:59The Committee will deliver price stability.
01:04So politics played no role in the decision.
01:08I just spent two days with my colleagues upstairs.
01:12I didn't hear an utterance about politics.
01:14I didn't hear a reference to politics, elections, what's happening in the next week or so.
01:22I didn't hear anything about it.
01:24And I don't believe it had any role in the decision, not just for me, but my colleagues
01:30around the room.
01:31But I will say it's an information-rich interval in the coming period, having nothing to do with
01:38politics.
01:43So on the thrust of your question of, with respect to the new technology and this investment
01:49surge, do interest rates matter?
01:52I believe they do.
01:53And I don't believe that they're somehow divorced from the rest of the economy.
01:57Secondly, I'll just say this.
02:02What I can do is tell you there's no soft inflation target, there's no implicit inflation target.
02:08There's a target of price stability and it's 2% as measured by PCE.
02:14It took six years for inflation to have the effect on consumers that you reference.
02:21But I would say this.
02:24When consumers interrogate reality, they look outside their window, too.
02:29They go to the gas station, too.
02:30And they see that prices are up.
02:32I am not going to be the guy who says that oil prices haven't gone up and when they fill
02:38up their tank, they don't see it.
02:40And so inflation's gone up in expectations in the very near term because they're doing
02:45what we're doing, interrogating reality.
02:47But if you look out over the horizon, if you look at most but not all measures, what you
02:54see is households, businesses, financial markets, they have the confidence that they should
03:01have that the central bank will deliver price stability.
03:06Edward Lawrence.
03:07Edward Lawrence.
03:07Edward Lawrence.
03:07Edward Lawrence.
