Yesterday was the first time that the new chairman of the Federal Reserve, Jerome Powell, testified before Congress. There has been quite a bit of coverage regarding what he said both in his initial statement and in response to questions. Here, I want to focus on just one sentence. After noting that “the FOMC [Federal Open Market Committee] routinely consults monetary policy rules,” he concluded with what I think was the most important sentence of the day: “Personally, I find these rule prescriptions helpful.” He then referenced a section in the Fed’s monetary policy report that goes through some of the more common rules and how the Fed applies them.

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