Appendix 1: Materials used by Mr. Sack
April 26–27, 2011 218 of 244Authorized for Public Release
Material for
FOMC Presentation:Financial Market Developments and Desk Operations
Brian Sack
April 26, 2011
Class II FOMC - Restricted FR
April 26–27, 2011 219 of 244Authorized for Public Release
Class II FOMC – Restricted FR Exhibit 1
0.0
1.0
2.0
3.0
4.0
08/03/09 01/03/10 06/03/10 11/03/10 04/03/11
Percent
2-Year 5-Year 10-Year
(4) Treasury Yields
Source: Bloomberg
FOMC
0.0
0.3
0.5
0.8
1.0
1.3
04/22/11 08/22/11 12/22/11 04/22/12 08/22/12
Percent04/21/1103/14/11
(1) Implied Federal Funds Rate Path*
*Based on federal funds and eurodollar futures rates.Source: Federal Reserve Bank of New York
85
105
125
145
165
185
08/03/09 01/03/10 06/03/10 11/03/10 04/03/11
Indexed to 08/03/09
Brent Oil*Commodities Index**
(2) Commodity Prices
*Front-month futures contract**Thomson Reuters/Jefferies CRB Commodity IndexSource: Bloomberg
FOMC
1.5
2.0
2.5
3.0
3.5
08/03/09 01/03/10 06/03/10 11/03/10 04/03/11
Percent
Federal Reserve BoardBarclays Capital
(3) Forward Breakeven Inflation Rates(5-Year 5-Year Rates)
Source: Federal Reserve Board of Governors, Barclays Capital
FOMC
12.8
13.2
13.6
14.0
14.4
14.8
10/01/10 12/01/10 02/01/11 04/01/11 06/01/11
$ Trillions
ProjectedCurrent Debt Limit
(6) Treasury Debt Outstanding
Source: Federal Reserve Board of Governors
Immediate Response*
Daily Change**
2Y Treasury -3 bps -2 bps10Y Treasury +4 bps -1 bps30Y Treasury +9 bps +2 bps
S&P 500*** -0.7% -0.7%DXY Dollar -0.3% +0.1%
(5) Market Reaction to S&P Announcement
*Change from 9 to 9:30 AM**Change from 9 AM to close***Change computed from futures prices.Source: Bloomberg
April 26–27, 2011 220 of 244Authorized for Public Release
Class II FOMC – Restricted FR Exhibit 2
0
200
400
600
800
1000
1200
0
500
1,000
1,500
2,000
2,500
08/03/09 01/03/10 06/03/10 11/03/10 04/03/11
BPSBPS
Greece (LHS)Portugal (RHS)Spain (RHS)Italy (RHS)
(9) Euro Area Sovereign Debt Spreads*
*2-year spreads to GermanySource: Bloomberg
FOMC
0
10
20
30
40
50
08/03/09 01/03/10 06/03/10 11/03/10 04/03/11
BPS(12) VIX Index
Source: Bloomberg
FOMC
75
80
85
90
11/01/10 12/11/10 01/20/11 03/01/11 04/10/11
¥/$(8) Japanese Yen
Source: Bloomberg
FOMC
80
90
100
110
11/01/10 12/11/10 01/20/11 03/01/11 04/10/11
Indexed to 08/03/09
(7) Japanese Equity Prices*
*Nikkei IndexSource: Bloomberg
FOMC
90
100
110
120
130
08/03/09 01/03/10 06/03/10 11/03/10 04/03/11
Indexed to 08/03/09
Euro/DollarBroad Dollar Index
(10) Foreign Exchange Rates
Source: Federal Reserve Board of Governors, Bloomberg
FOMC
Dollar Appreciation
90
100
110
120
130
140
08/03/09 01/03/10 06/03/10 11/03/10 04/03/11
Indexed to 08/03/09
US Bank Index*S&P 500
(11) U.S. Equity Prices
*KBW Bank IndexSource: Bloomberg
FOMC
Yen Appreciation
April 26–27, 2011 221 of 244Authorized for Public Release
Exhibit 3Class II FOMC – Restricted FR
0
20
40
60
80
100
120
Jun-
10
Aug
-10
Oct
-10
Dec
-10
Feb-
11
Apr
-11
Jun-
11
Aug
-11
Oct
-11
$ Billions
LSAP2Reinvestments
Forecast
(13) SOMA Purchases of Treasury Securities
Source: Federal Reserve Bank of New York
0.0
0.1
0.2
0.3
08/03/09 01/03/10 06/03/10 11/03/10 04/03/11
Percent
Treasury GC RepoFederal Funds Effective
(17) Short Term Funding Rates*
*5-day moving averageSource: Federal Reserve Bank of New York
FDIC Fee Implementation
0
5
10
15
20
25
30
08/03/09 01/03/10 06/03/10 11/03/10 04/03/11
$ Billions(18) SOMA Securities Lending Volume*
*10-day moving averageSource: Federal Reserve Bank of New York
FOMC
-4.0-2.00.02.04.06.08.0
10.012.014.0
4.0% 4.5% 5.0% 5.5%
BPS
Two Day WindowChange to Date
(15) Change in MBS Spreads*
*Option-adjusted spreadSource: Barclays Capital
0
100
200
300
400
500
3.5% 4.0% 4.5% 5.0% 5.5% 6.0% 6.5%
$ Billions
U.S. TreasuryFederal Reserve
(16) MBS Held in Official Portfolios
Source: Federal Reserve Bank of New York, U.S. Treasury
(14) SOMA Portfolio
*Holdings in $ billionsSource: Federal Reserve Bank of New York
June 2011 April 2010Holdings* Treasury 1,634 777 Agency 117 168 MBS 903 1,161 Total 2,654 2,106
Duration 4.64 4.36
April 26–27, 2011 222 of 244Authorized for Public Release
(19) Expected Use of Exit Tools Relative to First Target Rate Increase (% of Respondents)*
*Views on agency debt sales and redemptions largely followed those for MBS.Source: Federal Reserve Bank of New York Policy Survey
(24) Expected Spread between IOER Rate and Federal Funds Rate (in BPS)*
*Median valuesSource: Federal Reserve Bank of New York Policy Survey
100
200
300
400
500
600
700
800
RRPs TDFs RRPs & TDFs
$ Billions
Source: Federal Reserve Bank of New York Policy Survey
(23) Draining Capacity over Intermeeting Period
0
5
10
15
20
25
30
35
40
201-400
401-600
601-800
801-1000
1001-1200
1201-1400
1401-1600
% of Respondents
$ Billions
(22) Level of Reserves at First Target Rate Increase
Source: Federal Reserve Bank of New York Policy Survey
Class II FOMC – Restricted FR Exhibit 4
$1.5 Trillion
$1 Trillion
$500 Billion
$0 - $25 Billion
0.25% 16 9 2 -1
1.00% 17 14 5 -3
2.00% 25 15 6 0
Level of Excess Reserves
IOERRate
0.0
0.5
1.0
1.5
2.0
2.5
3.0
2009 2010 2011 2012 2013 2014 2015
$ Trillions
End-of-Year
Tealbook MedianInterquartile Range
(21) Expected Size of Domestic Assets in SOMA
Source: Federal Reserve Bank of New York Policy Survey
Source: Federal Reserve Bank of New York Policy Survey
(20) Expected Timing of Exit Tools Relative to First Target Rate Increase
-6 -4 -2 0 2 4 6Number of meetings
Interquartile RangeMedian
“Extended Period”
IOER
RRPsTDFs
Treasury Redem.MBS Redem.
Treasury SalesMBS Sales
MedianInterquartile Range
"Extended Period" 100 0 0 0
IO ER 5 95 0 0
RRPs 85 15 0 0TDFs 90 10 0 0
Treasury Redem. 55 5 25 15MBS Redem. 95 0 5 0
Treasury Sales 0 5 75 20MBS Sales 0 0 80 20
Before Concurrent After Never
April 26–27, 2011 223 of 244Authorized for Public Release
Appendix 2: Materials used by Mr. Nelson
April 26–27, 2011 224 of 244Authorized for Public Release
Material for
FOMC Briefing on Strategies for Removing Policy Accommodation
William R. Nelson
April 26, 2011
April 26–27, 2011 225 of 244Authorized for Public Release
Questions for Discussion: Strategies for Removing Policy Accommodation
1. Should the first step in exit be to stop the current policy of reinvesting the principal payments
from agency securities? Should that first step also include a halt to reinvestments of the principal
payments from Treasury securities?
2. In removing policy accommodation would you prefer to put asset sales on a largely pre-
determined and pre-announced path, or would you prefer to actively vary the pace of asset sales
in response to changes in the economic outlook?
3. In sequencing actions to remove accommodation, would you favor starting to sell assets
before, after, or at the same time as increasing the funds rate? Would you place a high priority
on reducing the size of the SOMA portfolio quickly, even if that would delay liftoff of the funds
rate?
4. Do you agree with each of the following statements?
The exit strategy should shrink the SOMA portfolio over the intermediate term to a
level no larger than what is necessary to implement the Committee’s monetary policy
framework.
The exit strategy should return the SOMA portfolio to an all-Treasuries composition
over the intermediate term, which will require sales of agency securities.
Asset sales should be implemented within a framework that has been communicated
to the public in advance, and at a pace that potentially could be adjusted in response
to changes in economic or financial conditions.
1 of 1
April 26–27, 2011 226 of 244Authorized for Public Release
Appendix 3: Materials used by Mr. Sheets
April 26–27, 2011 227 of 244Authorized for Public Release
Material for FOMC Briefing on International Developments
Nathan Sheets April 26, 2011
April 26–27, 2011 228 of 244Authorized for Public Release
Exhibit 1
Commodities: 2003 to 2008*
0
20
40
60
80
100
120
2004 2006 2008 2010 2012 2014
WTI Crude OilFutures Curves
Dollars per barrel
2003
2004
2005
2006
2007
2008
Source: Bloomberg.
9
10
11
12
13
14
15
16
2004 2006 2008 2010 2012 2014
ChinaConsensus Forecasts of Industrial Production
Percent change over previous year
2003
2004
2005
20062007
2008
Source: Consensus Economics.
0
1
2
3
4
2004 2006 2008 2010 2012 2014
CopperDollars per pound
2003
2004
2005
2006
2007
2008
Source: Bloomberg.
2
3
4
5
6
7
8
2004 2006 2008 2010 2012 2014
Emerging Asia excluding ChinaPercent change over previous year
2003
2004
2005
2006
2007
2008
*Each line represents futures prices or forecasts made in April of the indicated year.Source: Consensus Economics and staff estimates based on GDP weights.
Page 1 of 1
April 26–27, 2011 229 of 244Authorized for Public Release
Appendix 4: Materials used by Mr. Natalucci
April 26–27, 2011 230 of 244Authorized for Public Release
Material for Briefing on
FOMC Participants’ Economic Projections Fabio Natalucci April 26, 2011
Page 1 of 4
April 26–27, 2011 231 of 244Authorized for Public Release
2
1
+_0
1
2
3
4
5
Percent
Exhibit 1. Central tendencies and ranges of economic projections, 2011–13 and over the longer run
Change in real GDP
Range of projections
Actual
2006 2007 2008 2009 2010 2011 2012 2013 Longerrun
Central tendency of projections
5
6
7
8
9
10
Percent
Unemployment rate
2006 2007 2008 2009 2010 2011 2012 2013 Longerrun
1
2
3
Percent
PCE inflation
2006 2007 2008 2009 2010 2011 2012 2013 Longerrun
1
2
3
Percent
Core PCE inflation
2006 2007 2008 2009 2010 2011 2012 2013
Page 2 of 4
April 26–27, 2011 232 of 244Authorized for Public Release
2011 2012 2013 Longer run
Central Tendency 3.1 to 3.3 3.5 to 4.2 3.5 to 4.3 2.5 to 2.8
January projections 3.4 to 3.9 3.5 to 4.4 3.7 to 4.6 2.5 to 2.8
Range 2.9 to 3.7 2.9 to 4.4 3.0 to 5.0 2.4 to 3.0
January projections 3.2 to 4.2 3.4 to 4.5 3.0 to 5.0 2.4 to 3.0
Memo: Tealbook 3.2 4.2 4.3 2.8
January Tealbook 3.8 4.4 4.6 3.0
2011 2012 2013 Longer run
Central Tendency 8.4 to 8.7 7.6 to 7.9 6.8 to 7.2 5.2 to 5.6
January projections 8.8 to 9.0 7.6 to 8.1 6.8 to 7.2 5.0 to 6.0
Range 8.1 to 9.0 7.1 to 8.4 6.0 to 8.4 5.0 to 6.0
January projections 8.4 to 9.0 7.2 to 8.4 6.0 to 7.9 5.0 to 6.2
Memo: Tealbook 8.7 7.7 7.0 5.2
January Tealbook 8.9 7.8 7.0 5.2
2011 2012 2013 Longer run
Central Tendency 2.1 to 2.8 1.2 to 2.0 1.4 to 2.0 1.7 to 2.0
January projections 1.3 to 1.7 1.0 to 1.9 1.2 to 2.0 1.6 to 2.0
Range 2.0 to 3.6 1.0 to 2.8 1.2 to 2.5 1.5 to 2.0
January projections 1.0 to 2.0 0.7 to 2.2 0.6 to 2.0 1.5 to 2.0
Memo: Tealbook 2.2 1.2 1.5 2.0
January Tealbook 1.3 1.0 1.2 2.0
2011 2012 2013
Central Tendency 1.3 to 1.6 1.3 to 1.8 1.4 to 2.0
January projections 1.0 to 1.3 1.0 to 1.5 1.2 to 2.0
Range 1.1 to 2.0 1.1 to 2.0 1.2 to 2.0
January projections 0.7 to 1.8 0.6 to 2.0 0.6 to 2.0
Memo: Tealbook 1.4 1.4 1.5
January Tealbook 1.0 1.0 1.2
NOTE: The changes in real GDP and inflation are measured Q4/Q4
Change in real GDP
Unemployment rate
PCE inflation
Core PCE inflation
Exhibit 2. Economic projections for 2011-2013 and over the longer run (percent)
Page 3 of 4
April 26–27, 2011 233 of 244Authorized for Public Release
2
4
6
8
10
12
14
16
18
Number of participants
Exhibit 3. Risks and uncertainty in economic projections
Uncertainty about GDP growth
January projections
Lower Similar Higher
April projections
2
4
6
8
10
12
14
16
18
Number of participants
Uncertainty about PCE inflation
Lower Similar Higher
2
4
6
8
10
12
14
16
18
Number of participants
Risks to GDP growth
January projections
Downside Balanced Upside
April projections
2
4
6
8
10
12
14
16
18
Number of participants
Risks to PCE inflation
Downside Balanced Upside
Page 4 of 4
April 26–27, 2011 234 of 244Authorized for Public Release
Appendix 5: Materials used by Mr. English
April 26–27, 2011 235 of 244Authorized for Public Release
Material for
FOMC Briefing on Monetary Policy Alternatives Bill English April 27, 2011
April 26–27, 2011 236 of 244Authorized for Public Release
Page 1 of 8
MARCH FOMC STATEMENT
1. Information received since the Federal Open Market Committee met in January suggests that the economic recovery is on a firmer footing, and overall conditions in the labor market appear to be improving gradually. Household spending and business spending on equipment and software continue to expand. However, investment in nonresidential structures is still weak, and the housing sector continues to be depressed. Commodity prices have risen significantly since the summer, and concerns about global supplies of crude oil have contributed to a sharp run-up in oil prices in recent weeks. Nonetheless, longer-term inflation expectations have remained stable, and measures of underlying inflation have been subdued.
2. Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price
stability. Currently, the unemployment rate remains elevated, and measures of underlying inflation continue to be somewhat low, relative to levels that the Committee judges to be consistent, over the longer run, with its dual mandate. The recent increases in the prices of energy and other commodities are currently putting upward pressure on inflation. The Committee expects these effects to be transitory, but it will pay close attention to the evolution of inflation and inflation expectations. The Committee continues to anticipate a gradual return to higher levels of resource utilization in a context of price stability.
3. To promote a stronger pace of economic recovery and to help ensure that inflation, over time, is at levels
consistent with its mandate, the Committee decided today to continue expanding its holdings of securities as announced in November. In particular, the Committee is maintaining its existing policy of reinvesting principal payments from its securities holdings and intends to purchase $600 billion of longer-term Treasury securities by the end of the second quarter of 2011. The Committee will regularly review the pace of its securities purchases and the overall size of the asset-purchase program in light of incoming information and will adjust the program as needed to best foster maximum employment and price stability.
4. The Committee will maintain the target range for the federal funds rate at 0 to ¼ percent and continues to anticipate that economic conditions, including low rates of resource utilization, subdued inflation trends, and stable inflation expectations, are likely to warrant exceptionally low levels for the federal funds rate for an extended period.
5. The Committee will continue to monitor the economic outlook and financial developments and will
employ its policy tools as necessary to support the economic recovery and to help ensure that inflation, over time, is at levels consistent with its mandate.
April 26–27, 2011 237 of 244Authorized for Public Release
Page 2 of 8
APRIL FOMC STATEMENT—ALTERNATIVE A
1. Information received since the Federal Open Market Committee met in January March suggests that the economic recovery is on a firmer footing proceeding at a moderate pace, albeit somewhat more slowly than had been anticipated, and that overall conditions in the labor market appear to be are improving only gradually. Household spending and business investment in equipment and software continue to expand, but increased energy costs may be weighing on consumer purchases of non-energy goods and services. However Investment in nonresidential structures is still weak, and the housing sector continues to be depressed. Commodity prices have risen significantly since the last summer, and concerns about global supplies of crude oil have contributed to a sharp run up further increase in oil prices in recent weeks since the Committee met in March. Nonetheless, While inflation has picked up in recent months, longer-term inflation expectations have remained stable and measures of underlying inflation have been are still subdued.
2. Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price
stability. Currently, The unemployment rate remains elevated, and measures of underlying inflation continue to be somewhat low, relative to levels that the Committee judges to be consistent, over the longer run, with its dual mandate. The recent Increases in the prices of energy and other commodities are currently putting upward pressure on inflation. The Committee expects these effects to be transitory, but it will pay close attention to the evolution of inflation and inflation expectations. Although the Committee continues to anticipate a gradual return to higher levels of resource utilization in a context of price stability, recent developments have increased the downside risks to the outlook for economic growth.
3. To promote a stronger pace of economic recovery and to help ensure that inflation, over time, is at levels
consistent with its mandate, the Committee decided today to continue expanding its holdings of securities as announced in November. In particular, the Committee is maintaining its existing policy of reinvesting principal payments from its securities holdings and intends will complete to purchases of $600 billion of longer-term Treasury securities by the end of the second current quarter of 2011. The Committee will regularly review the pace of its securities purchases and the overall size of the assetpurchase program in light of incoming information and will adjust is prepared to expand and extend the purchase program the program as if needed to best foster maximum employment and price stability.
4. The Committee will maintain the target range for the federal funds rate at 0 to ¼ percent and continues to currently anticipates that economic conditions, including low rates of resource utilization, subdued inflation trends, and stable inflation expectations, are likely to warrant exceptionally low levels for the federal funds rate for an extended period at least through mid-2012.
5. The Committee will continue to monitor the economic outlook and financial developments and will
employ its policy tools as necessary to support the economic recovery and to help ensure that inflation, over time, is at levels consistent with its mandate.
April 26–27, 2011 238 of 244Authorized for Public Release
Page 3 of 8
APRIL FOMC STATEMENT—ALTERNATIVE B
1. Information received since the Federal Open Market Committee met in January March suggests indicates that the economic recovery is on a firmer footing proceeding at a moderate pace and overall conditions in the labor market appear to be are improving gradually. Household spending and business investment in equipment and software continue to expand. However, investment in nonresidential structures is still weak, and the housing sector continues to be depressed. Commodity prices have risen significantly since the last summer, and concerns about global supplies of crude oil have contributed to a sharp run up further increase in oil prices in recent weeks since the Committee met in March. Nonetheless, Inflation has picked up in recent months, but longer-term inflation expectations have remained [generally] stable and measures of underlying inflation have been are still subdued.
2. Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price
stability. Currently, The unemployment rate remains elevated, and measures of underlying inflation continue to be somewhat low, relative to levels that the Committee judges to be consistent, over the longer run, with its dual mandate. The recent Increases in the prices of energy and other commodities have pushed up inflation in recent months are currently putting upward pressure on inflation. The Committee expects these effects to be transitory, but it will pay close attention to the evolution of inflation and inflation expectations. The Committee continues to anticipates a gradual return to higher levels of resource utilization and a decline in inflation to rates consistent with the Federal Reserve’s mandate in a context of price stability.
3. To promote a stronger pace of economic recovery and to help ensure that inflation, over time, is at levels consistent with its mandate, the Committee decided today to continue expanding its holdings of securities as announced in November. In particular, the Committee is maintaining its existing policy of reinvesting principal payments from its securities holdings and intends to will complete purchases of $600 billion of longer-term Treasury securities by the end of the second current quarter of 2011. The Committee will regularly review the pace size and composition of its securities purchases holdings and the overall size of the asset purchase program in light of incoming information and will adjust the program is prepared to adjust those holdings as needed to best foster maximum employment and price stability.
4. The Committee will maintain the target range for the federal funds rate at 0 to ¼ percent and continues to anticipate that economic conditions, including low rates of resource utilization, subdued inflation trends, and stable inflation expectations, are likely to warrant exceptionally low levels for the federal funds rate for an extended period.
5. The Committee will continue to monitor the economic outlook and financial developments and will
employ its policy tools as necessary to support the economic recovery and to help ensure that inflation, over time, is at levels consistent with its mandate.
April 26–27, 2011 239 of 244Authorized for Public Release
Page 4 of 8
APRIL FOMC STATEMENT—ALTERNATIVE C
1. Information received since the Federal Open Market Committee met in January March suggests indicates that the economic recovery is on a firmer footing and overall conditions in the labor market appear to be are improving gradually. Household spending and business investment in equipment and software continue to expand. However, investment in nonresidential structures is still weak, and the housing sector continues to be depressed. Commodity prices have risen significantly since the summer, and concerns about global supplies of crude oil have contributed to a sharp run up further increase in oil prices in recent weeks since the Committee met in March. Nonetheless, Inflation has picked up in recent months, but longer-term inflation expectations have remained [generally] stable and measures of underlying inflation have been are still subdued.
2. Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price
stability. Currently, The unemployment rate remains elevated and measures of underlying inflation continue to be somewhat low, relative have moved somewhat closer to levels that the Committee judges to be consistent, over the longer run, with its dual mandate. However, The recent increases in the prices of energy and other commodities are currently putting upward pressure on are boosting overall inflation. The Committee expects these effects to be transitory so long as longer-term inflation expectations remain stable, but and it will pay close attention to the evolution of inflation and inflation expectations. The Committee continues to anticipate a gradual return to higher levels of resource utilization in a context of price stability.
3. To promote a stronger pace of economic recovery and to help ensure that inflation, over time, is at levels
consistent with its mandate In light of incoming information, the Committee judges that the increase in its holdings of longer-term securities since November is sufficient to promote appropriate progress toward maximum employment and price stability. Accordingly, the Committee decided today to continue expanding complete only $450 billion of the intended $600 billion increase in its holdings of securities as announced in November. In particular For now, the Committee is maintaining its existing policy of reinvesting principal payments from its securities holdings and intends to purchase $600 billion of longer term Treasury securities by the end of the second quarter of 2011. The Committee will regularly review the pace of its securities purchases and the overall size of the assetpurchase program needed its reinvestment policy and the level of its securities holdings in light of incoming information and will adjust the program make adjustments as needed to best foster maximum employment and price stability.
4. The Committee will maintain the target range for the federal funds rate at 0 to ¼ percent and continues to anticipates that economic conditions, including low rates of resource utilization, subdued inflation trends, and stable inflation expectations, are likely to warrant exceptionally low levels for the federal funds rate for an extended period some time.
5. The Committee will continue to monitor the economic outlook and financial developments and will
employ its policy tools as necessary to support the economic recovery and to help ensure that inflation, over time, is at levels consistent with its mandate.
April 26–27, 2011 240 of 244Authorized for Public Release
Page 5 of 8
March 2011 FOMC Directive
The Federal Open Market Committee seeks monetary and financial conditions that will foster price stability and promote sustainable growth in output. To further its long-run objectives, the Committee seeks conditions in reserve markets consistent with federal funds trading in a range from 0 to ¼ percent. The Committee directs the Desk to execute purchases of longer-term Treasury securities in order to increase the total face value of domestic securities held in the System Open Market Account to approximately $2.6 trillion by the end of June 2011. The Committee also directs the Desk to reinvest principal payments from agency debt and agency mortgage-backed securities in longer-term Treasury securities. The System Open Market Account Manager and the Secretary will keep the Committee informed of ongoing developments regarding the System’s balance sheet that could affect the attainment over time of the Committee’s objectives of maximum employment and price stability.
April 26–27, 2011 241 of 244Authorized for Public Release
Page 6 of 8
April 2011 FOMC Directive — Alternative A
The Federal Open Market Committee seeks monetary and financial conditions that will foster price stability and promote sustainable growth in output. To further its long-run objectives, the Committee seeks conditions in reserve markets consistent with federal funds trading in a range from 0 to ¼ percent. The Committee directs the Desk to execute purchases of longer-term Treasury securities in order to increase the total face value of domestic securities held in the System Open Market Account to approximately $2.6 trillion by the end of June 2011. The Committee also directs the Desk to reinvest principal payments from agency debt and agency mortgage-backed securities in longer-term Treasury securities. The System Open Market Account Manager and the Secretary will keep the Committee informed of ongoing developments regarding the System’s balance sheet that could affect the attainment over time of the Committee’s objectives of maximum employment and price stability.
April 26–27, 2011 242 of 244Authorized for Public Release
Page 7 of 8
April 2011 FOMC Directive — Alternative B
The Federal Open Market Committee seeks monetary and financial conditions that will foster price stability and promote sustainable growth in output. To further its long-run objectives, the Committee seeks conditions in reserve markets consistent with federal funds trading in a range from 0 to ¼ percent. The Committee directs the Desk to execute purchases of longer-term Treasury securities in order to increase the total face value of domestic securities held in the System Open Market Account to approximately $2.6 trillion by the end of June 2011. The Committee also directs the Desk to reinvest principal payments from agency debt and agency mortgage-backed securities in longer-term Treasury securities. The System Open Market Account Manager and the Secretary will keep the Committee informed of ongoing developments regarding the System’s balance sheet that could affect the attainment over time of the Committee’s objectives of maximum employment and price stability.
April 26–27, 2011 243 of 244Authorized for Public Release
Page 8 of 8
April 2011 FOMC Directive — Alternative C
The Federal Open Market Committee seeks monetary and financial conditions that will foster price stability and promote sustainable growth in output. To further its long-run objectives, the Committee seeks conditions in reserve markets consistent with federal funds trading in a range from 0 to ¼ percent. The Committee directs the Desk to execute purchases of longer-term Treasury securities in order to increase the total face value of domestic securities held in the System Open Market Account to approximately $2.6 $2.5 trillion by mid-May 2011. The Committee also directs the Desk to reinvest principal payments from agency debt and agency mortgage-backed securities in longer-term Treasury securities. The System Open Market Account Manager and the Secretary will keep the Committee informed of ongoing developments regarding the System’s balance sheet that could affect the attainment over time of the Committee’s objectives of maximum employment and price stability.
April 26–27, 2011 244 of 244Authorized for Public Release