[{"data":1,"prerenderedAt":-1},["ShallowReactive",2],{"doc-detail-324250-en":3,"doc-seo-324250-105":31,"detail-sidebar-cat-0-en-105":99},{"code":4,"msg":5,"data":6},0,"success",{"doc_id":7,"user_id":8,"nickname":9,"user_avatar":10,"doc_module":4,"category_id":11,"category_name":12,"doc_title":13,"doc_description":14,"doc_content":15,"file_id":16,"file_url":17,"file_type":18,"file_size":19,"view_count":20,"is_deleted":4,"is_public":21,"is_downloadable":21,"audit_status":21,"page_count":22,"language":23,"language_code":24,"site_id":25,"html_lang":24,"table_of_contents":26,"faqs":27,"seo_title":28,"seo_description":14,"update_tm":29,"read_time":30,"preview_page_count":4},324250,2336464648746,"Skyler","https://ap-avatar.wpscdn.com/davatar_276721f389ce27ea32af1340a28f341c",8,"Research & Report","Humphrey-Hawkins: The July 1988 Monetary Policy Report - Economic Commentary","A July 1988 economic commentary reviews the Federal Reserve’s Monetary Policy Report submitted to Congress under the Humphrey-Hawkins Act. It explains the decline in the role of monetary targets in the policy-monitoring process as uncertainty grows about how monetary aggregates reliably signal policy intentions. The report describes how the FOMC’s forecasts of inflation and economic growth supplement or replace strict reliance on aggregates, outlining 1988 and 1989 objective ranges for M2, M3, M1, and DNFD.","by William T.Gavin and John N.McElravey  \nTwnech year;he hairmn ofthe Board of Governors of the FederalReserve System appears before Con-gressionai banking committees toreport on the economy and to pre-sent objectives for monetary policy.These reports are required by the FullEmployment and Balanced GrowthAct of 1978,better known as theHumphrey-Hawkins Act(H-H),whichdescribes the responsibility of thefederal government with respect toeconomic policy.!  \nIn February,the Chairman reviewsthe economy and Federal Reserve'sperformance during the previous yearand formally announces money andcredit targets for the current year.InJuly,the Chairman reviews the econ-omy and policy for the current yearand presents preliminary targets forthe following year.These semiannualreports provide a way for Congressand for the public,to monitor theFederal Reserve's policies.  \nA combination of deregulation anddisinflation has led to increaseduncertainty about the role of mone-tary aggregates in the policy process.²Because neither the Federal Reservenor the public is confident that the  \nHumphrey-Hawkins:The July 1988Monetary Policy Report  \nactual performance of these aggregates is a reliable indicator of thethrust of monetary policy,the statements of the Federal Open MarketCommittee(FOMC)and its forecastsof economic conditions have becomemore important in the policy.monitoring process.3  \nThis Economic Comnentary reviewsJuly's Monetary Policy Report to Con-gress,discusses the decline in therole of the monetary targets,andexplains how the FOMC's projectionsof inflation and economic growthmay contain information that is usefulin the policy·monitoring process.  \n## ■ The 1988/1989 MonetaryPolicy Objectives\n\nFederal Reserve Chairman AlanGreenspan appeared before Congressin July and reaffirmed the decisionsthe FOMC made in February.Themonetary targets for 1988 remain at 4to 8 percent growth for both M2 and  \nM3.For the second straight year,theFOMC did not establish a target for  \nM1,reflecting the narrow aggregate'sheightened short-run interest-ratesensitivity.  \nThe ranges for M2 and M3 werewidened last February to four percen-tage points from the traditional three  \nAugust 1,1988  \nA review of the Federal Reserve'sMonetary Policy Reports to Congressover the last few years reveals adecline in the role of the monetaryaggregates in the policy process.TheFederal Open Market Committee'sprojections of economic conditionssupplement the money targets inevaluating current policy intentions,particularly in regard to pricestability.  \npercentage points in recognition ofthe:“...unusual degree of uncertaintyin the economic outlook and thelarge movements of money relative toincome in recent years….\"The rangefor domestic nonfinancial debt(DNFD)for 1988 remains at 7 to 11percent.In the first half of 1988,bothM2 and M3 have grown in the upperhalves of their target ranges.  \nThe tentative growth ranges for 1989are 3 to7 percent for M2,3%to7%percent for M3,and 6%to 10%percent for DNFD.The 1989 range for  \nM2 is one percentage point lowerthan the 1987 target.This gradualdecline in the targets is consistentwith the Federal Reserve's disinfla-tionary policy over the last severalyears.Nevertheless,the ranges fornext year are so wide that they couldbe associated with a policy to con·tinue toward price stability and zeroinflation,or they could be associatedwith a policy to stabilize the inflationtrend at around 4 percent  \nChairman Greenspan noted in his tes-timony the difficulty of deciding onappropriate growth ranges for theaggregates,especially given theirincreased sensitivity to movements ininterest rates.He admitted that themonetary aggregates have an impor-tant role,but in a shorter-run context,\"monetary aggregates have drawbacksas rigid guides to monetary policyimplementation.\"5 The targetedmonetary aggregates are \"among theindicators\"that influence adjustmentsto FOMC policy.He did add,how-ever,that their importance couldgrow in the future as the short-runrelationships ","cbCaivJes4l5Awv6","https://ap.wps.com/l/cbCaivJes4l5Awv6","pdf",1051643,12,1,5,"English","en",105,"# The 1988/1989 Monetary Policy Objectives\n# The Decline in the Role of the Monetary Targets","[{\"question\":\"What is the Humphrey-Hawkins Act requirement described in the report?\",\"answer\":\"It requires the Federal Reserve’s Chairman to appear before congressional banking committees to report on the economy and present objectives for monetary policy.\"},{\"question\":\"How did the report describe the July 1988 monetary policy announcement process?\",\"answer\":\"In July, the Chairman reviews the economy and policy and presents preliminary targets for the following year, using semiannual reports to let Congress and the public monitor Federal Reserve policy.\"},{\"question\":\"Why has the role of monetary targets declined according to the commentary?\",\"answer\":\"Uncertainty about the relationship between monetary aggregates and policy thrust increased, so monetary growth became a less reliable leading indicator compared with FOMC statements and forecasts.\"}]","Humphrey-Hawkins: The July 1988 Monetary Policy Report - Economic Commentary | 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is the Humphrey-Hawkins Act requirement described in the report?","Question",{"text":82,"@type":83},"It requires the Federal Reserve’s Chairman to appear before congressional banking committees to report on the economy and present objectives for monetary policy.","Answer",{"name":85,"@type":80,"acceptedAnswer":86},"How did the report describe the July 1988 monetary policy announcement process?",{"text":87,"@type":83},"In July, the Chairman reviews the economy and policy and presents preliminary targets for the following year, using semiannual reports to let Congress and the public monitor Federal Reserve policy.",{"name":89,"@type":80,"acceptedAnswer":90},"Why has the role of monetary targets declined according to the commentary?",{"text":91,"@type":83},"Uncertainty about the relationship between monetary aggregates and policy thrust increased, so monetary growth became a less reliable leading indicator compared with FOMC statements and 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