Full comparison of changes in the September meeting statement of the Federal Reserve

The Federal Reserve decided to cut interest rates by 50 basis points in September, adjusting the target range for the federal funds rate to 4.75% to 5%. In addition to the rate cut decision, compared to the statement from the last meeting in July, there were two major changes in the Federal Open Market Committee (FOMC) meeting statement released by the Federal Reserve on Wednesday, September 18 this week.

First, the committee has increased confidence in curbing inflation, removing expressions from the July statement such as "inflation has slowed somewhat over the past year, but remains somewhat high" and "it is not appropriate to lower the target range until there is more confidence in moving towards 2% inflation," and changing it to "inflation is further progressing towards the committee's 2% target, but still slightly above the target," and adding the expression "the committee has increased confidence in inflation sustainably approaching 2%."

Second, in fulfilling the dual mandate of controlling inflation and ensuring employment, the Fed's focus has shifted towards employment, changing the balance of risks in achieving employment and inflation targets from "continuing to trend" to "roughly" balanced, and adding the expression "a firm commitment to supporting full employment."

Finally, Federal Reserve Board member Bauman voted against the 50 basis point rate cut, preferring a 25 basis point cut at this meeting. This is the first time since 2005 that a board member has dissented against a Federal Reserve rate cut decision, and Bauman is the first FOMC member to vote against since 2022.

The full statement is translated as follows, black font indicates the same parts as the July FOMC meeting statement in 2024, black font with annotations in parentheses is additional supplementary content added by Wall Street News, red font indicates new additions in September 2024, blue font in parentheses indicates deleted wording from the July statement (please indicate the source when reprinting):

Recent indicators suggest that economic activity continues to expand steadily. Job growth has slowed, the unemployment rate has risen slightly, but remains low. Inflation is further progressing towards the committee's (note: FOMC committee) 2% target, but still slightly above the target. (Inflation has slowed somewhat over the past year, but remains somewhat high. In recent months, some further progress has been made in achieving the committee's 2% inflation target.)

The committee (note: FOMC committee) strives for maximum employment in the long run and a 2% inflation rate. The committee has increased confidence in inflation sustainably approaching 2% and believes that the risks in achieving employment and inflation targets are roughly (continuing to trend) balanced. The economic outlook is uncertain, and the committee is concerned about the risks facing its dual mandate.

Given the progress of inflation and the balance of risks, the committee decided to lower the federal funds rate target range by 0.5% to 4.75% to 5%. (To support the committee's goals, the committee decided to maintain the target range for the federal funds rate at 5.25% to 5.50%.) When considering any further adjustments to the target range of the federal funds rate, the committee will carefully assess future data, evolving outlook, and risk balance. (The committee expects that it is not appropriate to lower the target range until there is more confidence in moving towards 2% inflation.) (In addition,) the committee will continue to reduce its holdings of U.S. Treasury securities, agency debt, and agency mortgage-backed securities. The committee firmly commits to supporting full employment and returning the inflation rate to the 2% targetWhen evaluating the appropriate monetary policy stance, the committee will continue to monitor the latest information on the impact on the economic outlook. If risks arise that may hinder the achievement of the objectives, the committee will be prepared to adjust the monetary policy stance as appropriate. The committee's assessment will take into account a wide range of information, including labor market conditions, inflation pressures and expectations, as well as data on financial and international developments.

Those in favor of this monetary policy decision include: FOMC Chairman Jerome H. Powell (Note: Chairman of the Federal Reserve), Vice Chairman John C. Williams (Note: President of the New York Fed), Barkin (Thomas I. Barkin) (Note: President of the Richmond Fed), Barr (Michael S. Barr) (Note: Federal Reserve Board of Governors), Bostic (Raphael W. Bostic) (Note: President of the Atlanta Fed), Bowman (Michelle W. Bowman) (Note: Federal Reserve Board of Governors); Cook (Lisa D. Cook) (Note: Federal Reserve Board of Governors); Daly (Mary C. Daly) (Note: President of the San Francisco Fed); Hammack (Beth M. Hammack) (Note: President of the Cleveland Fed), Goolsbee (Austan D. Goolsbee) (Note: President of the Chicago Fed); Jefferson (Philip N. Jefferson) (Note: Federal Reserve Board of Governors), Kugler (Adriana D. Kugler) (Note: Federal Reserve Board of Governors), and Waller (Christopher J. Waller) (Note: Federal Reserve Board of Governors). The only member who voted against this action was Bowman (Michelle W. Bowman) (Note: Federal Reserve Board of Governors), who preferred to lower the federal funds rate target range by only 1/4 percentage point at this meeting. Goolsbee (Austan D. Goolsbee) (Note: President of the Chicago Fed) voted as an alternate member at this meeting