Sector when its in their best interest when the care is better or specialized care is available thats not in the va. I think we all believe that should be available. Watch book tv every weekend on cspan2. Federal reserve chair Jerome Howell announced a ab following the announcement he took reporters questions regarding the action and the economic outlook. Good afternoon and welcome. My colleagues at the Federal Reserve and i are dedicated to serving the american people. We do this by steadfastly pursuing the goals that congress has given us. Maximum employment and stable prices. We are committed to making the best decisions we can based on facts and objective analysis. Today we decided to lower the Interest Rates for the third time this year. We took this step to help keep the u. S. Economy strong in the face of Global Developments and to provide insurance against ongoing risks. As i will explain shortly, the policy adjustments weve made since last year providing and will continue to provide meaningful support to the economy. We believe Monetary Policy is in a good place. The u. S. Economy is in its 11th year of expansion. The baseline outlook remains favorable. The overall economy is growing at a moderate rate, Household Spending continues to be strong supported by healthy job market rising incomes and solid Consumer Confidence. In contrast, Business Investment and exports remain weak and manufacturing output has declined over the past year. Sluggish growth abroad and trade developments have been weighing on those sectors. Looking ahead, we continue to expect the economy to expand at a moderate rate reflecting solid Household Spending and support financial conditions. The job market remains strong. Unemployment rate has been near halfcentury lows for year and and a half. The pace of job gains has eased this year but remain solid. We expected some slowing after last years strong takes. Participation in the labor force by people in the prime working years has been increasing. And wages have been rising particularly for lower paying jobs. People who live and work in lower and middle income communities tell us that many who have struggled to find work are now getting opportunities to add new and better chapters to their lives. This underscores for us the importance of the sustaining the expansion so that the strong job market reaches more of those left behind. Inflation continues to run low our symmetric two percent objective. Over the 12 months through august, total pce inflation was 1. 4 percent and core inflation was 1. 8 percent. Inflation pressures remain muted and indicators of longerterm Inflation Expectations are at the lower end of their historic ranges. We are mindful that continued below target inflation could lead to a nonwelcomed downward slide in longterm Inflation Expectations. However, against the backdrop of the Strong Economy and support of monetary policies we expect inflation will rise to two percent. Overall, we continue to see sustained expansion of Economic Activity a strong labor market and inflation in the area symmetric two percent objective as most likely. While this has been the outlook for quite some time, our views about path of Interest Rate that will best achieve these outcomes have changed significantly over the past year. As i mentioned, weakness in Global Growth and trade developments have weighed on the economy and posed ongoing risks. These factors in conjunction with muted inflation pressures have led us to lower our assessment of the appropriate level of the federal funds rate over the past year. In both july and september we reduce the target rate for the federal funds rate by one quarter percentage point and we did so again today bringing the range to 1. 5 and 1 3 4 percent. The policy adjustments weve made today will continue to provide significant support for the economy. Since Monetary Policy operates with a leg, the full effects of these adjustments on Economic Growth job market and inflation will be realized over time. We see the current stance of Monetary Policy is likely to remain appropriate. As long as incoming information about the economy remains broadly consistent with her outlook. And inflation near the two percent objective. We believe Monetary Policy is in a good place to achieve these outcomes. Looking ahead, we will be monitoring the effects of our policy actions along with other information bearing on the outlook. As we assess the appropriate path of the target range for the fed funds rate. Of course, if developments emerge, it caused a material reassessment of our outlook, we would respond accordingly. Policy is not preset course. In the end with a few words about our technical Monetary Policy operations, in january we made the key decision to continue to implement Monetary Policy and an ample reserves regime. In that operating framework we control the federal funds rate primarily by setting our administered rates. Two frequent interventions to active the supply reserves. In the transition to the efficient and effective level of reserves in this regime, we slowed the gradual decline in our Balance Sheet in march and stopped in july. In response to the funding pressures and money markets that emerged in midseptember we concluded it would be appropriate to maintain over time a level of reserve balances at or above the level that prevailed in Early September of this year. To achieve this ample level we announced october 11 that we would purchase Treasury Bills at least into the Second Quarter of next year as well as continue temporary open Market Operations at least through january. These actions are purely technical measures to support the effective implementation of Monetary Policy as we continue to learn about the appropriate level of reserves. They do not represent a change in the stance of Monetary Policy. In particular. Our Treasury Bill purchasers should not be confused with largescale asset purchase programs that we deployed after the financial crisis. In those programs we purchase longerterm securities to put downward pressure on longerterm Interest Rates and ease broader financial conditions. In contrast, increasing the supply of reserves by purchasing Treasury Bills only alters the mix of sort shortterm assets by the public and should not affect the demographic demand and supply for longerterm securities or financial conditions more broadly. Thank you, i will be happy to take your questions. Michael mckee with Bloomberg Radio and television. The question is, is this it . Do you consider rates to be accommodative enough to achieve your goal of sustaining the expansion and as far as global wall street primary question, what kind of change in the economy would cause you to reassess some sort of significant deterioration in what . What weve said to repeat is that we see the current stance of policy is likely to remain appropriate as long as incoming information about the economy remains broadly consistent with her outlook. We say that really because both the performance of the economy and the stance of policy. The performance and economy has been particularly the household sector has been strong and resilient with low unemployment, attractive levels of job creation, wages will be up, Labor Force Participation will be up household competence and solid gains in many measures of consumer spending. The Manufacturing Sector particularly manufacturing and investment and exports have been weaker but overall weve seen moderate growth with inflation moving up we see the outlook for more of the same we also see the risks of the outlook. As perhaps having moved in a positive direction over the course of this period although some remain to be seen. Thats the economy, turning to policy, we will do stance a policy over the course of the year to more accommodate stance and after cuts of the last three meetings its now in the range of 1. 51 three quarters percent we feel that policy is wellpositioned to support the outlook that i described. So you ask what it would take to move and as i mentioned. We will be watching all factors and if developments emerge that cause the material reassessment of her outlook we would respond accordingly but thats what it would take a material reassessment of our outlook. We would be looking at a full range of data with the economy and the risks of the outlook. And ive given you a sense of what our outlook is, its for moderate growth, strong labor market and inflation near two percent objective. If something happens to cause us to material reassess the outlook thats what would cause us to change our views on the appropriate sense of policy. Heather long from the washington post. You just said that the risks to the outlook are moving in a positive direction, and wondering if you could specify is that on trade or other matters . This morning we obviously learned we now had two quarters of contracting Business Investments which would seem to be moving the outlook in the other directions. The principal risks weve been monitoring have been really slowing Global Growth and trade policy developments. As well as muted inflation pressure i was referring there to trade developments. We have phase 1 potential agreement with china which if signed and put into effect could have the effect of reducing trade tensions and producing uncertainty and that would bode well we think for Business Confidence and perhaps activity over time. That has the potential for being an improvement in the risk picture. Brexit i would say as well it appears that the risk of a no deal brexit seems to have materialized materially decline, i think both situations theres plenty of risk left but i have to say the risk seem to have subsided. You ask about Business Investment, thats right, Business Investment has been weakened, todays reading was weak as well. It was brought across equipment and and other parts of business fixed investment were weak. Thats consistent with what we have seen but thats the economy we had this year. What we have had is an economy where the consumer is driving growth and personal consumption expenditures were almost 3 percent in this quarter in this First Reading for the quarter. Overall we see the economy as having been resilient to the winds that have been blowing this year. There is a concern that i sometimes hear with businesses of cut investment are they going to turn around and cut employment if they continue to be concerned. That is a risk we been monitoring but we dont see it yet. We dont see the rising initial claims or layoffs or anything like that but the risk you mentioned the weakness in the manufacturing export investment Business Investment parts of the economy getting into the consumer side, we really dont see that we continue to see is good job creation, unemployment has declined again in the Household Survey is now at 50 year low, its been very close to 50 year lows for 18 months now. Its a very positive, the consumer facing companies we talked to in the vast network of contacts report that consumers are doing well and focused on the good job market and rising incomes and that the principal focus. Thats the thing thats pushing the economy forward and doesnt seem to be have been affected so far by weakness in the other areas. You have previously compared this great cutting cycle to the insurance cuts in the 90s. In both of those instances, the greenspan said to take these cuts back after a while. They raise cuts again fairly quickly. Im curious what the bonuses for doing that in this cycle . What would make you decide its appropriate to raise Interest Rates again . The reason why we raise Interest Rates is because generally, its because we see inflation as moving up or in danger of moving up significantly and we really dont see that now. Inflation moved down in the First Quarter of this year we thought that was due to some extent to it egocentric or ab it turns out to be the case was moved back up but it seems to be settling in the low two percent. We really dont see that risk and Inflation Expectations also moved down and sideways both surveys and marketbased over the course of really the recent months and we think Inflation Expectations are very important in driving actual inflation and we are strongly committed to achieving our two Percent Inflation objective on symmetric basis we think its essential we do that. We are not thinking about raising rates right now. There obviously will be times in the future where that will be appropriate but what we are they really thinking now is that our current stance of policy is appropriate and will remain so as long as the outlook is broadly in keeping with our expectations. Mr. Chairman, not to make light of it im a little bit a acan you help me out with the appropriate understanding of the word appropriate. The statement says that the community is going to monitor the application of incoming information for the outlook as if assesses the appropriate path of the target range. That tells me you could go either way. You came in and use the word appropriate that the current rate is likely to remain appropriate which means you are on hold. How i walk away from this, what should we walk away from this believing what appropriate means . You want to hold and need to be proved wrong but you should remain on hold . Or really could go either way . We think the current stance of policy is likely to remain appropriate. Likely to remain appropriate. As long as incoming information about the economy is broadly consistent with our outlook. Which is a positive one of moderate Economic Growth, strong labor market and inflation moving close to two percent. Thats what we are saying about that we also say of course if developments emerge that cause material reassessment of that outlook we would respond accordingly. Thats really how we are thinking about it. I cant point to one data point or one thing that would change her mind, it really would be a reassessment of material reassessment of our overall applicants which is what i describe. Why isnt the phrase abif thats the sense of the committee. There is a lot of practice in science and history in terms of how much you put in the actual postmeeting statement as opposed to what we say in the press conference statement. Its a judgment call. Im saying it now. Nick demirels with the wall street journal. Described in the recent slides, and Inflation Expectations as welcome. You can say the Inflation Expectations are very awhat if anything with the committee be prepared to do to address this slide in Inflation Expectations if it continued . We do think Inflation Expectations are quite essential, quite sensual in our framework of how we think about inflation. We need them to be accurate and a level that is consistent with our symmetric two percent infringement goal. We think that we need a policy in a way that supports the outcome. Thats what were doing now. Also as part of our review we are looking at potential innovations, changes to the way we think about things. Changes to the framework that will lead us that would be more supportive of achieving inflation two percent on a symmetric two percent basis over time. Thats at the very heart of what we are doing the review. Its too early to announce decisions. We are in the middle of thinking about ways that we can make that symmetric two Percent Inflation objective more credible by achieving symmetric two Percent Inflation. It comes down to using your policy tools to achieve two Percent Inflation. That is the thing that must happen for credibility in this area. We are in the middle, really quite in the middle of it now. My thinking is still that it will run into the middle of next year. The changes to Monetary Policy frameworks have been, they dont happen quickly. Inflation targeting took many years to evolve i dont think it will take many years i think we will wrap it up around the middle of next year would be my guess. How big of a change to Monetary Policy would there be if you get uncertainty cleared up a specifically that phase 1 trade deal finished in ab ratified. How big of a change could that be to the Monetary Policy when you remove the uncertainty the president s would rise could there be a point i guess my question is, how big of an impact on military policy would moving the uncertainty. I would say that if