Fed launches comprehensive operational review…5 task force leaders and external experts 15 appointed
Federal Reserve Chair Kevin Warsh appointed 5 task force leadership teams and external experts 15 on 9 local time. The task forces will review communications, the balance sheet, data, productivity and employment, and the inflation framework. He also indicated that changes could come within the year.
Federal Reserve Chair Kevin Warsh 9 announced on the Federal Reserve website that he had appointed 5 task force leadership teams to review how the central bank operates. Investors may take note of the decision because it could alter the Federal Reserve’s policy tools and overall approach to communication.
At his first press conference last month, Chair Warsh foreshadowed a “major overhaul of the Fed” and, although no specific timeline was disclosed, indicated that changes would come this year.
The 5 task forces cover communications, the balance sheet, data, productivity and employment, and the inflation framework. The Federal Reserve said it would carefully examine whether each task force could improve policymakers’ tools and methods, analytical tools, and policy approaches.
Each task force is led by external advisers 3each, with a total of external experts included.15The external members include Wall Street figures, academics, and former central bank officials.
The communications task force includes former Bank of England Governor Mervyn King, Peter R. Fisher, formerly of the Federal Reserve Bank of New York, and former Central Bank of Brazil Governor Arminio Fraga. The task force will review the Federal Reserve’s communication methods, including forward guidance.
The balance-sheet task force is led by Karen Dynan and former Reserve Bank of India Governor Raghuram Rajan, among others. Chair Wash has criticized quantitative easing for causing polarization in asset markets and plans to analyze the benefits and institutional implications of the balance sheet.
The list of external advisers is also reported to include Nobel Prize winners. The Federal Reserve announced that it plans to adjust its internal policy operations based on the review findings and recommendations from each task force.
Sources: 뉴시스 경제
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