Federal Reserve

Members of the Federal Reserve frequently give public speeches, providing transparency and guiding market perceptions. Monitoring these speeches reveals a general "higher-for-longer" sentiment regarding the federal funds rate.

The Fed's June 2024 meeting kept rates unchanged but highlighted rising inflation concerns, with core PCE inflation projections increased to 2.8%. Our Advance Macro Fear Indices show heightened FOMC worries about inflation, economic activity, and labor market.

Using the Advance Macro FOMC Hawk/Dove Index as a framework, the article analyses the Fed's communication tone during press conferences. The historical analysis highlights significant shifts in tone, particularly during important events like the COVID-19 pandemic and the Ukraine invasion.

Using the Advance Macro FOMC Hawk/Dove Score Index (Fed's officials' speeches), the article explores how the Federal Reserve officials' public speeches can reveal their monetary policy biases.

The article explores how FOMC communications impact U.S. households' inflation expectations using the Advance Macro Fear Inflation Index as a tool to capture Fed's ongoing concerns about inflation.