Navigating Monetary Policy: Challenges and Changes

This chapter investigates the evolution of the Federal Reserve's monetary policy framework, highlighting its dual mandate of promoting maximum employment while ensuring stable prices. It discusses recent revisions aimed at enhancing transparency and adaptability in response to economic conditions, particularly the impact of inflation and the COVID-19 pandemic. Additionally, the chapter examines the political dynamics affecting the Federal Reserve, including reactions to recent speeches and potential interest rate cuts that could shape market expectations and economic outcomes.