Answer after reading

FOMC

Congratulations, you have been “elected” as a voting member of the Federal Open Market Committee! You are preparing your research to determine how you will vote at the next meeting scheduled for December 18th and 19th. Your vote must be consistent with the FOMC’s statutory mandates: “seek to foster maximum employment and price stability”.

Therefore, you are considering the following:

· A comparison of the last two meetings’ Press Releases (see attached)

· November 8, 2018

· September 26, 2018

· The latest unemployment statistics issued by the U.S. Department of Labor

· The latest statistics about the level of inflation

· The unprecedented comments by President Trump such as

· The FOMC “has ‘gone crazy’ by continuing to raise interest rates (October 10, 2018)

· “’not thrilled’ with rate hikes and worries that the work the Administration has done will be nullified” (July 19, 2018)

Your assignment is to prepare a Word document to answer the following questions:

1. At the December 18th and 19th meeting

a. Will you vote to raise the Federal Funds rate?

i. If yes, how much should they be raised?

ii. If yes, why?

iii. If no, why not?

2. Looking at the 2019 meetings

a. Will you vote to raise the Federal Funds rate?

i. If yes, how many times should they be raised?

ii. If yes, what is your target rate for the end of 2019?

iii. If no, why not?