Good afternoon. My colleagues and I remain squarely focused on achieving our dual mandate goals of maximum employment and stable prices for the benefit of the American people. Our economy has made considerable progress toward both goals over the past two years. The labor market has come into better balance, and the unemployment rate remains low. Inflation has eased substantially from a peak of 7% to 2.5%. We are strongly committed to returning inflation to our 2% goal in support of a strong economy that benefits everyone. Today, the FOMC decided to leave our policy interest rate unchanged and to continue to reduce our securities holdings. We are maintaining our restrictive stance of monetary policy in order to keep demand in line with supply and reduce inflationary pressures. We are attentive to risks on both sides of our dual mandate, and I will have more to say about monetary policy after briefly reviewing economic developments. Recent indicators suggest that economic activity has continued to expand at a solid pace. GDP growth moderated to 2.1% in the first half of the year, down from 3.1% last year. Private domestic final purchases, or PDFP, which excludes inventory investment, government spending, and net exports, and usually sends a clearer signal of underlying demand, grew at a 2.6% pace over that same period, the first half. Growth of consumer spending has slowed from last year's robust pace but remains solid. Investment in equipment and intangibles has picked up from its anemic pace last year. In the housing sector, investment stalled in the second quarter after a strong rise in the first. Improving supply conditions have supported resilient demand and the strong performance of the U.S. economy over the past year. In the labor market, supply and demand conditions have come into better balance. Payroll job gains averaged 177,000 jobs per month in the second quarter, a solid pace, but below that seen in the first quarter. The unemployment rate has moved up, but remains low at 4.1%. Strong job creation over the past couple of years has been accompanied by an increase in the supply of workers, reflecting increases in participation among individuals aged 25 to 54 years and a strong pace of immigration. Nominal wage growth has eased over the past year, and the jobs-to-workers gap has narrowed. Overall, a broad set of indicators suggest that conditions in the labor market have returned to about where they stood on the eve of the pandemic: strong but not overheated. Inflation has eased notably over the past 2 years, but remains somewhat above our longer run goal of 2%. Total PCE prices rose 2.5% over the 12 months ending in June. Excluding the volatile food and energy categories, core PCE prices rose 2.6%. Longer-term inflation expectations appear to remain well anchored, as reflected in a broad range of surveys of households and businesses and forecasters, as well as measures from financial markets. My colleagues and I are acutely aware that high inflation imposes significant hardship as it erodes purchasing power, especially for those least able to meet the higher costs of essentials like food, housing, and transportation. Our monetary policy actions are guided by our dual mandate to promote maximum employment and stable prices for the American people. In support of these goals, the Committee decided at today's meeting to maintain the target range for the federal funds rate at 5.25%-5.5%, and to continue reducing our securities holdings. As the labor market has cooled and inflation has declined, the risks to achieving our employment and inflation goals continue to move into better balance. Indeed, we're attentive to the risks to both sides of our dual mandate. We have stated that we do not expect it will be appropriate to reduce the target range for the federal funds rate until we have gained greater confidence that inflation is moving sustainably toward 2%. The second quarter's inflation readings have added to our confidence, and more good data would further strengthen that confidence. We will continue to make our decisions meeting by meeting. We know that reducing policy restraint too soon or too much could result in a reversal of the progress we have seen on inflation. At the same time, reducing policy restraint too late or too little could unduly weaken economic activity and employment. In considering any adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, the evolving outlook, and the balance of risks. As the economy evolves, monetary policy will adjust in order to best promote our maximum employment and price stability goals. If the economy remains solid and inflation persists, we can maintain the current target range for the federal funds rate as long as appropriate. If the labor market were to weaken unexpectedly or inflation were to fall more quickly than anticipated, we are prepared to respond. Policy is well positioned to deal with the risks and uncertainties that we face in pursuing both sides of our dual mandate. The Fed has been assigned two goals for monetary policy: maximum employment and stable prices. We remain committed to bringing inflation back down to our 2% goal and to keeping the longer-term inflation expectations well anchored. Restoring price stability is essential to achieving maximum employment and stable prices over the longer run. Our success in delivering on these goals matters to all Americans. We understand that our actions affect communities, families, and businesses across the country. Everything we do is in service to our public mission. We at the Fed will do everything we can to achieve our maximum employment and price stability goals. Thank you. I look forward to your questions. Jeanna. Jeanna Smialek from the New York Times. Thanks for taking our questions. Markets pretty much entirely expect a rate cut in September at this stage. I wonder if you think that's a reasonable expectation, and if so, why not just make the move today? Thank you. So, on September, let me say this: we have made no decisions about future meetings, and that includes the September meeting. The broad sense of the Committee is that the economy is moving closer to the point at which it will be appropriate to reduce our policy rate. In that, we will be data-dependent, but not data-point dependent. So it will not be a question of responding specifically to one or two data releases. The question will be whether the totality of the data, the evolving outlook and the balance of risks, are consistent with rising confidence on inflation and maintaining a solid labor market. If that test is met, a reduction in our policy rate could be on the table as soon as the next meeting in September. So you asked, why not today? I would just say, again, that the broad sense of the Committee is that we're getting closer to the point at which it will be appropriate to reduce our policy rate, but that we're not quite at that point yet. Howard. T o follow up on that a bit, if inflation behaves as you expect between now and September, would you regard a cut in September as sort of the baseline scenario right now? So I guess I would think about it this way. I'll give an example of cases in which it would be appropriate to cut and maybe that it wouldn't be appropriate to cut. So if we were to see, for example, inflation moving down quickly or more or less in line with expectations, growth remains, let's say, reasonably strong, and the labor market remains c onsistent with its current condition, then I would think that a rate cut could be on the table at the September meeting. If inflation were to prove s tickier, and we were to see higher readings from inflation, disappointing readings, we would weigh that along with the other things. I t's gonna be not just any one thing, it's going to be the inflation data, it's gonna be the employment data, it's gonna be the balance of risks as we see it. It's gonna be the totality of all of that that helps us make this decision. Just to follow up on that, specifically, in what ways right now, given all you've seen over the last few months, in particular on, on shelter, on services, et cetera, in what ways are you not confident right now that inflation is on the way back to 2%? I t's just a question of seeing more good data. We have seen the last couple of readings have certainly added to confidence, and we've seen progress across all three categories of core PCE inflation. That's goods, non-housing services, and housing services. So it's really just w e had a quarter of poor inflation data at the beginning of the year, then we saw some more good inflation data. We had seven months at the end of last year. W e just wanna see more and gain confidence. And as I said, we did gain confidence, and more good data would cause us to gain more confidence. Colby. Thank you. Colby Smith with The Financial Times. The March SEP pointed to three cuts in 2024, with core inflation at 2.6% and the unemployment rate at 4%. Since we're now at that level in terms of inflation and already beyond what was projected for the labor market, I'm just wondering if that rate path is back to being the best guidepost for policy, rather than, let's say, the shallower one laid out in the June SEP? T he path ahead is going to depend on the way the economy evolves. I can't really give you any, any, better forward guidance on it than that. We, we didn't, of course, do an SEP at this meeting. We will do another one at the September meeting. I would just say I can, I can imagine a scenario in which there would be everywhere from zero cuts to several cuts, depending on the way the economy evolves. I wouldn't wanna lay out a, a baseline path for you there today. I've said what I, what I can say about September and about, about today, though. Nick. Nick Timiraos of The Wall Street Journal. Chair Powell, you've said before that you wouldn't wait until inflation got to 2% to cut rates because of how inflation has lagged. Does that apply for the labor market, too? If the labor market is back in equilibrium, why is restrictive policy and potentially very restrictive policy, given the high real funds rate, warranted right now? So this is the very reason that we're thinking about t hat we've said in our statement, that we're going back to looking at both mandates, and that we think the risks are coming back into balance. We think what the data broadly show in the labor market is an ongoing, gradual normalization of labor market conditions, and that's what we wanna see. W e've seen that over a period of a couple of years, and a move really from overheated conditions to more normal conditions. We are watching the labor market conditions quite closely, and that's what we're seeing. If we start to see something that looks to be more than that, then we're well positioned to respond. That's part of what we're thinking. When you talk about seeing something that's more than whatever softness or slowdown you expect, in the past, you've said that stronger growth wouldn't override better news on inflation. I wonder how that cuts the other way. If you're seeing more softness in the labor market than what you would expect, does that change the calculus on what you're looking for out of the inflation numbers t o recalibrate policy? We have two mandates. The labor market and maximum employment is one, and stable prices is another. W e weigh those two things equally under the law. When we were far away from our inflation mandate, we had to focus on that. Now we're back to a closer to even focus. W e'll be looking at labor market conditions and asking whether we're getting what we're seeing. A s I said, we're prepared to respond if we see that it's not what we wanted to see, which was a gradual normalization of conditions, if we see more than that. I t wouldn't be any one statistic, although, of course, the unemployment rate is generally thought to be a good single statistic. But we'd be looking at wages, we'd be looking at participation, we'd be looking at all the things, surveys, quits, hires, all of those things to determine the overall status of the labor market. But we're looking at it now. I would say again, Y ou're back to conditions that are close to 2019 conditions, and that was not an inflationary economy. Broadly similar labor markets then. I nflation was actually core inflation was actually running below 2%. So we don't think, I don't now think of the labor market in its current state as a likely source of significant inflationary pressures. I would not like to see material further cooling in the labor market, and that's part of what's behind our thinking. The other part, of course, is that we have made real progress on inflation, and we've got growing confidence there that we are not quite there yet, but we're getting more confident that we're on a sustainable path down to 2%. So those two things are working together, and we're factoring those both into our policy. Chris. Chris Rugaber, Associated Press. You mentioned not wanting to see any further cooling in the job market. Why not, or would you consider preemptive cuts to prevent if you saw risks of an unexpected cooling? Is that something you would cut ahead of time for? I wouldn't say I wouldn't want to see any other cooling. It would be more of material difference. If we'd be looking at this, and if we see something that looks like a more significant downturn, that's that would be something that w e would have the intention of responding to. So in terms of, I don't think of it that way. I think of it as we're actually in a good place here. We're balancing these two risks of go too soon, and you undermine progress on inflation, wait too long or don't go fast enough, and you put at risk the recovery. And so we have to balance those two things. That's the nature of having two mandates, and W e this is how we balance them. It's a rough balance, bu t does feel like, the, again, the labor market feels like it's in a place where it's, it's just a process of ongoing normalization. 4.1% unemployment is still historically low. W e'll just have to see what the data show us. Just to follow quickly, wanted to see what you thought of the recent JOLTS report, which did show hiring, gross hiring, has come down even below 2019 levels. Layoffs remain low, so it painted a picture of a very static labor market. Is that sustainable in your view or something that is worrying? Thank you. All of the data points continue to point to kind of the direction we would want to see. So that was taken as t here was a decline in job openings. That was good. Today's ECI reading was a little softer than expected, so that's a good reading. It shows that wage increases are still at a strong level, but that level continues to come down to more sustainable levels over time. That's exactly the pattern that we want to be seeing. T he data we've been seeing in the labor market are broadly consistent with that normalization process. Again, we're closely monitoring to see whether it starts to show signs that it's more than that. Steve. Steve Liesman, CNBC. Mr. Chairman, back in March, you talked about cutting rates as a process, and in June, you talked about the idea that, well, one rate cut wouldn't do anything. So I wonder if you can sort of follow up on Colby's question. Talk about, are you weighing the economy right now in terms of its ability to withstand multiple rate cuts? Talk us through the process that you're thinking, or is it just one rate cut? Are you in the process now of thinking that rates need to be normalized here? Thank you. I can't really say that, honestly. W e've seen significant movement in the labor market, and w e're very mindful of this question of is it just normalization or is it more? We think it's just normalization, but we want to be in a position to support the labor market. At the same time, we're seeing progress on inflation. W e actually got to this... We raised rates a year ago at the July meeting, and if you look at the situation in the economy a year ago, unemployment, sorry, inflation was over, was over 4%. It was a completely different economy. Now, we've made a lot of progress, and the labor market as u nemployment was in the 3s, mid-3s. It's a different economy, and i t's time, it's coming to be time to adjust that so that we support this continued process. The thing we're trying to do is t hat we have, we've had this really significant decline in inflation, and unemployment has remained low, and this is a really unusual and historically unusual and such a welcome outcome for the people we serve. What we're thinking about all the time is: How do we keep this going? And this is, this is part of that. We think we, we don't need to be 100% focused on inflation because of the progress we've made. Twelve-month headline at 2.5, core at 2.6, it's way down from where it was. The job is not done on inflation, but nonetheless, we can afford to begin to dial back the restriction in our policy rate. W e're just a part of a process. In terms of what that looks like, y ou would think in a base case, that policy rates would move down from here. But I don't wanna try to give specific f orward guidance about when that might be, because the pace at which it might happen, because t hat's really gonna depend on the economy, and that's highly uncertain. Rachel. Hi, Chair Powell. Rachel Siegel from The Washington Post. Thanks for taking our questions. On inflation, do the past few months of good reports look like what we saw last year, where you really had a lot of momentum with a few bumps in between? Would you characterize that kind of momentum as back on track at this point in the year? Actually, what we're seeing now is a little better than what we saw last year. Last year, as we pointed out late in the year, a whole lot of the progress we saw last year was from goods prices, which were going down at an unsustainable rate, disinflating at an unsustainable rate. This is a broader disinflation. This has goods prices coming down, but it's also, we're also now seeing progress in the other two big categories: non-housing services and housing services. T he thing is, we've only, you've got one quarter of that. We had seven months of low inflation. You got one quarter of this. I would say the quality of this is higher, and it's good, but it's, but so far, it's only a quarter. W e need to see more to know that we're, t o have more confidence that we're on a good path down to 2%. But as I mentioned, our confidence is growing because we've been getting good data. And things like the ECI report, and frankly, the softening in the labor market conditions, g ive you more confidence that the economy's not overheating. It doesn't look like an overheating economy, and it looks like an economy that's normalizing. If we're to think about the first couple of months of the year, is there any sense now that there were these blips that could have actually allowed for earlier rate cuts, as were some of the projections going into 2024? T he thing about if what it is is seasonality, and it could just be. It's very, very hard t o do appropriate seasonal adjustments. If that's what it is, then that actually implies that other months were underreporting too low inflation. If you smoothed it out, i t's a zero-sum game. That's why we look at 12 months. We look at 12 months because that takes all that out, all those effects out. 12-month now is 2.5% headline, 2.6% core. This is so much better than where we were even a year ago. It's a lot better. Now, the job is not done, I wanna stress that, and we're committed to getting inflation sustainably under 2%. W e need to take note of that progress, and we need to weigh the risks to the labor market and the risks to our inflation target now, more equally than we did a year ago. Michael McKee. Michael McKee from Bloomberg Radio and Television. I'd like to ask you about the balance of risks as the American people see it. At this point, is the risk greater to leave interest rates where they are, given the damage that higher interest rates do to the economy in slowing demand and raising prices? Or is it more important for the American people that you keep rates where they are to bring inflation down? We've been given an assignment by Congress. This is how we serve the American people, is by achieving maximum employment and price stability, right? And so in our, quasi-constitutional document, the statement on longer-run goals and monetary policy strategy, we look at the two goals, and if one of them is farther away than the other... The two variables, inflation and employment, if one is farther away from its goal than the other, then you concentrate on the one that's farther away, and you take account of the time to reach the goal. So for the last couple of years, the best service we could do to the American people was to focus on inflation. But as inflation has come down, and t he upside risks to inflation have decreased as the labor market has cooled off, now the labor market has softened, p robably the inflation is probably a little farther from its target than is the employment. T he downside risks to the employment mandate are real now. So we have to weigh all that, and if you think about where that takes us, is we have a restrictive policy rate. It's clearly restrictive. It's been the rate we've had in place for a full year, and the time is coming, as other central banks around the world are facing the same question. The time is coming at which it will begin to be appropriate to dial back that level of restrictions so that we may address both mandates. Well, you have event risk, basically, with the jobs report on Friday and another one before you meet again. Are you certain that you won't fall behind the curve and lead to unnecessary unemployment, if you wait until September? Certainty is not a word that we have in our, in our business. W e get a lot of data between now and September, and it isn't gonna be one data read or, or even two. It's gonna be the totality of the data, all of the data, and not just the... And, and then how is that affecting the outlook, and how is it affecting the balance of risks? That's gonna be the assessment that we do. Of course, we'll l ook carefully at the employment report, but so much other data coming in and so much happening between now and, and the September meeting, and we'll make a judgment. Edward. Thank you, Mr. Chairman. Edward Lawrence from FOX Business. I do wanna dig deeper on what Michael and what Nick were asking. There's a shift in the statement to balance between the focus between inflation and jobs. Looking at the jobs side, we've seen wage data show sort of an abrupt slowing. We're hearing on earnings calls from companies like Intel, abrupt layoffs. In the jobs report from the BLS, government jobs has been a leading creator. Could the government jobs as a sector hiring mask underlying weakness in the jobs report? W e'll look at everything. We've seen some tendency to have a narrowing base of job creation in some months going back, but then we've had some months where job creation was broader. A lso t he headline number of jobs has come down. W e would but you look at the whole thing, and y ou do look at private demand extra carefully, to your point about government. W e'll just be looking at all those things. So, as a follow-up then, so could the Fed then be behind the curve? 'Cause you said some of the reports, in the last meeting, you said the reports could be noisy or overstated. Was there a discussion of what kind of discussion was there for a cut today, and could the Fed be behind the curve? T he objective is to balance the two risks, right? It's the risk of going too soon and the risk of going too late. We'v e had seven months of good inflation data at the end of last year. We said we wanted to see more. We said that we pointed out that too much of this was coming from goods, and sure enough, the first quarter wasn't great inflation data. And And now we've got another quarter, a quarter that is good, and w e're balancing the risk of going too soon against the risk of going too late. That's what we're doing. There's no guarantee in this. It's a very difficult judgment call, but this is how we're making it. I n terms of today, your question about today, w e had a nice conversation about, about this issue today. The overall sense of the Committee, as I mentioned, is that we're getting closer to the point at which it'll be appropriate to begin to, to dial back restriction, but we're not quite at that point yet. We want to see more good data. The decision was unanimous. All 19 participants supported it. T here was a real discussion back and forth, of what the case would be for, for moving at this meeting. A strong majority supported moving, not moving at this meeting. That was the strong sense of the Committee, but it's a conversation that we had today, certainly. Courtenay. Courtenay Brown from Axios. Thank you for taking our questions. When the Fed was raising rates, there was a lot of conversation about long and variable lags. I wonder if that applies on the way down, too. How are you and the Committee thinking about that? Yes, it does. T he lags have kind of showed up here in the last six months, by the way. You really do now see the restriction, whereas, e ven a few months ago, people were questioning how restrictive policy was. Look at the labor market now. You can see and look at it in, look at, inflation, sorry, rate-sensitive, interest-sensitive spending. You really do see now that policy is restrictive. I wouldn't say it's extremely restrictive, but it's certainly effectively restrictive. Yes, the lag should be on the way down. It should take some time to get into the full economy, affect financial conditions, and that affects economic activity, hiring, and that kind of thing, and ultimately inflation. It's not instantaneous, although it's faster than it used to be because markets move now in anticipation of our moves. Are you worried then that if monetary policy acts with long and variable lags, even when you're lowering interest rates, it might be too late for the Fed to help stave off any kind of slowdown in the labor market or broader economy? We have to worry about that. T o make it clear, i t's a very difficult, challenging judgment, and we didn't want to go too soon, and we don't want to go too late. But that's how we've made that judgment. I feel good about where we are. We're certainly very well positioned to respond to weakness with the policy rate at 5.3%. We certainly have a lot of room to respond if we were to see weakness. That's not what we're seeing, though. What we're seeing, look at the first half growth numbers. Look at PDFP at 2.6% for the first half. It's not signaling a weak economy. It's also not signaling an overheating economy. Labor market, admittedly, the unemployment rate has moved up 0.7, and we're seeing, w e're seeing a normalization there. W age increases are still at a high level. Unemployment is still at a low level. Layoffs are very low. Initial claims have moved up, but they're pretty stable, and they're historically not high at all. So the total scope of the data suggests a normalizing labor market, and again, we are carefully watching to see that that continues to be the case. Victoria. Hi, Victoria Guida with POLITICO. On the labor market, I was wondering, how worried are you all about unemployment rising to the point where it triggers the Sahm Rule? And would that potentially affect how quickly you cut rates? T he question really is, are we worried about a sharper downturn in the labor market? So, the answer is we're watching really carefully for that. We're aware of that rule, I would call it a statistical thing that has happened through history. A statistical regularity is what I'd call it. It's not like an economic rule where it's telling you something must happen. So again, what do we see? What are our eyes telling us? We look at all the things we're seeing, and what it looks like is a normalizing labor market. Again, job creation at a pretty decent level, wages moving up at a strong level, but coming down gradually. Job vacancies have come down, but they're still high by historical standards. So again, I've been through some of the data already, but what we think we're seeing is a normalizing labor market. And we're watching carefully to see if it's if it turns out to be more - if it starts to show signs that it's more than that, then we're well positioned to respond. Is there a reason to think that the labor market might behave differently this time than it has historically? H istory doesn't repeat itself, it rhymes. T hat statement is very true about the economy. You never assume it's gonna be just the same. An example would be, is there a trend increase in the level of vacancies? There are many, many examples, so it's never exactly the same. Also, let's remember that this pandemic era has been one in which so many apparent rules have been flouted, like the inverted yield curve, for starters. So many, many pieces of received wisdom just haven't worked, and it's because the situation really is unusual or unique in that so much of this inflation came from the shutdown in the economy and the resulting supply problems in the face of admittedly very strong demand. T he whole, the whole situation isn't, is not the same as many of the other prior inflation or downturns that we've seen, or business cycles that we've seen. So we're having to learn. W e're having t o be very careful about the judgments that we make, I would say. So we don't assume that, that these regularities will, will just repeat themselves automatically. Amara. Thank you, Chair Powell. Amara Omeokwe with Bloomberg. There seems to be quite a difference between what the anecdotal data are telling us, such as the very recent, downbeat Beige Book, and the hard data. Do you take those anecdotes seriously, that is, that the economy and labor market are cooling much more rapidly than what's shown in the data? I do take that seriously, and it, the Beige Book is great. What's even greater is hearing the Reserve Bank presidents come in and talk about their conversations with businesses and business leaders and workers and people in the nonprofit sector in their districts. But it's, I'll tell you, it's a pretty, t he picture is not one of a slowing or, a really bad economy. It's one of there are spots of weakness and there are regions where growth is stronger than other regions, but overall, it's. A gain, look at the aggregate data. Aggregate data is, p articularly PDFP, private domestic final purchases, is 2.6%, and that's a good indicator of private of private demand. So we listen to all of that, and it does. It's important to listen to anecdotal data and not just look at the aggregate data, especially, i t's very hard. GDP data can be volatile, quarter to quarter. So it's just hard to measure economic activity. It's just difficult to do. So I look at both, but I wouldn't say that the anecdotal data is uniformly downbeat. It's more mixed. Jo Ling. Thank you. Jo Ling Kent with CBS News. Chair Powell, thanks for taking our questions today. You have consistently said that the Fed does not consider politics in making decisions. With a possible September rate cut on the table, it would be less than two months before the election, and former President Trump reportedly said that cutting rates so close to the election is something the central bank knows they shouldn't be doing. What's your response, and do you believe it's possible to really remain apolitical with a September rate cut? I absolutely do, and first of all, we haven't made any decisions. I would say it this way: Haven't made any decision about any future meeting. I don't know what the data will reveal or how that will affect the appropriate path of our policy. I really don't know. I do know how we will make that assessment. That's what I do know. So if you take a step back, the current situation, again, is inflation has come down much closer to our goal, and that's happened while unemployment has remained low. We're very tightly focused on using our tools to try to foster that state of affairs continuing. That's at each of our meetings and all of our decisions, our focus is strictly on that and really on nothing else, doing our part, whatever that part may be. W e're using our best thinking. We're doing our best to understand the economy. We follow academics, we follow the many commentators who bless us with their commentary. But we don't change anything in our approach to address other factors, like the political calendar. Congress has, we believe, ordered us to conduct our business in a non-political way at all times, not just some of the time. I'll say this, too. We never use our tools to support or oppose a political party, a politician, or any political outcome. The bottom line is, if we do our very best to do our part and we stick to our part, that will benefit all Americans. If we get it right, the economy will be stronger, we'll have price stability, people will find jobs, wages will rise in real terms. Everyone will benefit. So that's what we believe, and that's how we will always act. This is my fourth presidential election at the Fed. I can tell you, this is how we think about it. This is what we do. So it's anything that we do before, during, or after the election will be based on the data, the outlook, and the balance of risks, and not on anything else. Just a quick follow-up. Do your economic forecasts and models take into account the two very different economic plans of these two presidential candidates, Harris and Trump? And if so, how? W e do not do that. We absolutely do not do that. We don't, we don't know who's gonna win. We don't know what they're gonna do. We don't act as though we know, and we just can't do that. W e basically have our forecast. We're not. We can run simulations of different potential policies, but we would never try to make policy decisions based on the outcome of an election that hasn't happened yet. That would just be a line we would never cross. W e're a non-political agency. We don't, we don't wanna be involved in any politics in any way, so we wouldn't do that. Nicholas. Thank you, Chair Powell. Nicholas Jasinski from Barron's Magazine. There hasn't been a dissenting vote on an interest rate decision in some time. If the data do evolve as you expect, if you do have more confidence by the September meeting, do you get the sense that there will be a unanimous vote on an interest rate move, in September? Or basically, are there meaningful differences in, Committee members' assessments of how much more confidence is needed? T here are always meaningful differences. W e talk a lot before, during, and after the meeting. We do have a very robust discussion of these things. You're right, that in most cases, people, if they feel heard, and they feel that they've, that t heir position has been given serious consideration, for most people, most of the time, that's gonna be enough. There are dissents. That's fine. N o one has a veto. N o single person has a veto. I t just is a question of who will vote for and against. We've had dissents. We haven't had so many during the pandemic era, and it just may be that w e've felt more united because we felt nder a lot of pressure to get things right. But before the pandemic, we had plenty of dissents happen. It's part of the process. There's nothing wrong with dissents, and if it happens, it happens. Jean. Hello, Jean Yung with MNI Market News. Is a 50 basis point cut as a first cut, at all likely or even on the table? Thank you. I don't wanna say, I don't wanna be really specific about what we're gonna do, but that's not something we're thinking about right now. Jennifer. Of course, I haven't made any decisions at all as of today. Thank you, Chair Powell. Jennifer Schonberger with Yahoo Finance. Not to get into the minutes, but you said there was a real discussion today for moving at this meeting. I'm curious if you could provide some more color on the nature of the discussion today at the meeting about a possible rate cut as early as September? T he way the meeting is set up, the first day, there's a discussion of financial stability because it's every other meeting we have that, and then we have an opportunity to comment on that. Then we have an economic go-around. And then this morning, we have the monetary policy go-around. I n people's economic go-around and in their monetary policy go-around, people express their views about this, and t here's a range of views. People, as you well know from the speeches that they give, people have different ways of thinking about the economy. And so, in the minutes, we'll lay this out in a much better way than I can do off the cuff. But there's a range of perspectives, and, b ut I do think that, w e're a consensus-driven organization. People come together. This was a unanimous decision, and at the end, everyone supported the outcome, not just the voters, but everyone. I would also say some people examined the possibility, t he case for moving at this meeting. But overwhelmingly, the sense of the Committee was not at this meeting, but as soon as the next meeting, depending on how the data come in. There is a growing sense of confidence that you could move at the next meeting [crosstalk] assuming inflation comes? A ssuming that the totality of the data supports such an outcome. N o question. That is the case. That, as I mentioned, w e think that the time is approaching, and if we do get the data that we hope we get a reduction in our policy rate could be on the table at the September meeting. Nancy. Hi, Chair Powell, Nancy Marshall-Genzer with Marketplace. Former New York President Bill Dudley wrote an op-ed in Bloomberg earlier this month, which you probably saw, in which he said, quote: "It might already be too late to fend off a recession by cutting rates. Dawdling now unnecessarily increases the risk." Is he wrong? T his is the judgment that we have to make, and we're well aware of the judgment. A s I've said, we have to weigh the risk of going too soon against the risk of going too late. If we go too soon, w e had a lot of advice to go ahead and cut after the seven good months of last year. We didn't. We said we needed to see more. Then we saw some higher inflation. We've seen one quarter of good inflation, and we've seen the labor market move quite a bit. And as I mentioned, I don't think it needs to cool off any more for us to get the inflation results that are related to the labor market. Not all inflation is, of course. I t's a difficult judgment to make, and what you see is the judgment of the Committee, is that that time is drawing near. That time could be in September, if the data support that. Have the chances of a hard landing increased? W hether they've increased. T hey're low. Y ou don't see any reason to think that this economy is either overheating or sharply weakening. That's just not in the data right now. What's in the data right now is an economy that's growing at a solid pace, a labor market that has cooled off, but nonetheless, inflation—sorry, unemployment is low. T he data overall show a strong labor market. T hat's really what you see. It's not—It's neither an overheating economy, nor is it a sharply weakening economy. It's kind of what you would wanna see, but of course, it's—the job is never done. W e're watching to see w hich way the economy heads, and i f we are to respond to weakness, we're certainly, w ell-equipped to do that. But that's not what we're seeing. What we're seeing is strong economic activity and a good labor market and inflation coming down. Greg. Thank you so much. In the minutes of the June meeting that came out a few weeks ago, there was a discussion about communications, and some Fed officials said maybe the Fed wasn't as clear enough about its reaction function. When I talked to the commentators who bless you with their comments, they say that they really don't have a sense of what is gonna judge, maybe not the first cut, but the pace of the cuts going forward. They don't have a good sense of that. Is there anything you can say, like, how will we judge that? T he reality is that forecasters, and this isn't just the Fed by any means, forecasters have been continually surprised by, for example, the strength of the economy last year. W e have to be pretty humble about giving forward guidance about this, that, and the other thing. We need to be pretty careful about that. W hen you're saying you're gonna be data-driven, of course, it's always what the data, how they affect the outlook and the balance of risks. N obody has great vision deep into the future. In terms of a reaction function, that's a long time d iscussion that people have had forever. P eople have understood for a long time, actually, that we were very focused on bringing down inflation. Nobody was really confused about that. The data have a gain, you've seen significant improvement in inflation just for the last quarter. Markets move around on that, on the data, really, not so much. It's not really what we're gonna do. It's more just that the data keep coming in, and markets are very, very responsive to that data right now. Go to Jeff for the last question. Thank you, Mr. Chairman. I'm gonna change gears on you just a little bit from all of the rate talk and whatnot. With FedNow being in the books for a little over a year, there hasn't been a whole lot of talk about Central Bank Digital Currency, and wondering if you could give us an update on where things are with that. Is that considered a dead issue now, or is it still something that's being discussed within the Committee, and what, what's happening with that? It's not something that comes up at all with the, in the FOMC. M ore broadly, digital finances is an area that has really significant implications for payments generally, instant payments. It's something that's going to really change the way.. t's gonna make more efficient and hopefully safer and all of those things, the way payments are made around the world. And so we have people who are researching that and trying to keep up to speed because we play an important role in the payments sector, both as a convener and as an operator, too. In terms of a CBDC, there's really nothing new going on. There's not much going on at all. We're not. W e don't have the authority to issue a CB, a retail CBDC that's available to the public. We're not seeking that authority. So what we're doing is keeping up with developments there. Pretty much every major central bank in the world is at least doing that. Some of them are actually seriously looking at implementing a CBDC. We're really not. We're really just evaluating, t he story and what's happening out there. I 's work that we need to be doing, which could be very beneficial down the road, but we don't have. On a CBDC, we don't have any plan to. We would need to go to Congress, and we have no plan to do that. No one here has decided that we think it's a good idea yet. Thank you. Thank you, Dean Treanor, for the invitation to speak here today. I'm very sorry that circumstances prevent me from joining you in person. I will start by acknowledging the parents, spouses, partners, other family members, and mentors who are here. Without your support, sacrifice, and encouragement, we wouldn't have so much to celebrate today. To the class of 2024, congratulations on earning your law degree. You are the most selective class in Georgetown history, chosen from 14,000 applicants, and the most qualified as well. Among you are Fulbright Scholars, military veterans, Peace Corps, AmeriCorps, and Teach for America alumni, student athletes, accomplished musicians, and even a medical doctor. An impressive group. This is also the most diverse class in the 154-year history of the school. I'm especially proud to say today that there is a lot of Georgetown in my family tree. My father graduated from the college in 1943 before serving in the U.S. Army in World War II. After the war, he received his law degree here and practiced law in Washington, D.C. I'm fortunate to have two wonderful daughters. One graduated from the college in 2012. The other is a member of the class of 2026 at the Law Center. It seems like yesterday that I was in your shoes, receiving my degree, looking forward with optimism and excitement, and wondering what lay ahead. I cannot help but think fondly of my time here. For many years, friends from law school have gathered annually for a weekend to refresh our ties and laugh about times gone by. These gatherings are referred to as Big Chill, a reference to a 1983 movie that revolved around a midlife reunion of college friends. I made lifelong friendships here that I keep to this day, and I hope it will be the same for you. Along with all the hard work, I also remember the fun. A favorite tradition was to attend Saturday midnight showings of The Rocky Horror Picture Show at the Key Theater on Wisconsin Avenue in Georgetown. Now, if you've led a culturally deprived life and are tragically unfamiliar with that movie, it is a raucous musical starring a young Tim Curry. Everyone in the theater would sing along, shout out the lines, and throw popcorn at the screen. Many would dress up like the characters. Now, I didn't dress up, sorry to disappoint you, but no party was complete until all of us danced The Time Warp to the movie's famous song. As it happens, I still remember the steps to that dance, and I had intended to demonstrate The Time Warp for you, but that will not be possible today. Instead, I will offer a few thoughts that I might have benefited from hearing when I was sitting in your chairs a mere 45 years ago. The years since my graduation have brought waves of fundamental change to the workplace and to society at large, much of it driven by technology. Imagine a world with no internet, no email or texting, no personal computers or cell phones, no social media. Some of you parents are no doubt thinking, "I'd be fine with that world." The pace of change will likely continue to be very fast. Be alert to the ways your working life may change. Think about how you can be prepared for those changes and to turn them to your advantage and to society's advantage. The practice of law has been transformed over the years. If you do choose the path of a practicing lawyer, I'd be thinking about what practicing law could look like in 10 or 20 years. In a world that will continue to evolve quickly and in unexpected ways, you, you will need to be agile. Embracing change and taking risks can be an important part of your development as a professional and as a person. Your formal education may end today, but you are not done learning. Many of the important things you'll need to know can only be learned through experience, and experience can be a hard but irreplaceable teacher. As an example, near the end of my second year here, it was time to select the next editor-in-chief of the Georgetown Law Journal. I thought that there were plenty of colleagues who were better qualified, but who simply didn't want the job. So with much trepidation, I put my name in. I was secretly but utterly terrified that I might be chosen, and amazingly enough, I was. What now? It turned out that, as I feared, I was not that well prepared for that responsibility. I had to keep people interested and motivated enough to work on the journal when many things competed for their attention. I had to have a plan for the organization and not just for myself. I had to do this while exhibiting confidence that I did not feel. My main memory of that time is thinking, "This is harder and far different from what I had expected." What I now know, though, is that almost no one is ready for their first leadership roles. When you step into a leadership role, it is very common to doubt yourself. If I could tell my younger self something, it would be to believe in yourself and put yourself in situations in which you will be seriously challenged to do new things. Assume that you will make mistakes. Learn from those mistakes. Do not dwell excessively upon them in regret. You will fall down, get up, and repeat the cycle. The more you do that, the more you will learn and the faster you will develop as a person and as a leader. Know also that in my experience, there is no single model of a successful leader. Each of you has it in you to lead successfully. One of the great things about your legal education is it sets you up for success on a wide variety of potential paths. I left the practice of law a few years after I left this school, but my legal education has benefited me all along the way. Studying law teaches you to think clearly, analyze thoroughly, and understand all sides of an argument. The possibilities that lie ahead of you are extremely broad. You may work for a single law firm for your entire career, or you may leave the law fairly soon, as I did, and never look back. You will always benefit from what you learned here. In fact, the fact is I do keep a copy of the Federal Reserve Act in my top drawer at work, which I consult very often. Like many of you, I imagine, I knew that I wanted to do public service. As I left law school, I remember thinking about people like George Shultz and Cyrus Vance, prominent figures of the day who had successful private sector careers and served periodically in government. The head of the investment bank in New York, where I worked as a young man, was Nicholas F. Brady, who had an extraordinary career in investment banking and had served as well as a U.S. senator from New Jersey... I was the most junior of employees, but I wanted to reintroduce myself and tell him about my own aspirations. Approaching him was quite daunting. Maybe he would decline to meet with me. Maybe he would think I wasn't committed to the firm if I told him I was interested in public service. I finally summoned the courage to present myself at his office. I told him that I grew up in Washington, had been a federal law clerk and a congressional staffer, and wanted to do public service along the way. I said that, "If you need someone to staff you on anything you do in Washington, I'm your guy." He said something along the lines of, "Great, thanks." I then crept back down the stairs to my broom closet of an office, wondering whether that was gonna matter. A few months later, though, I got a call from his secretary. I can still hear her gravelly voice saying, "Can you come up and see Mr. Brady?" When I got up there, he said, "I need you to help me out with this thing." This thing turned out to be defending an oil company from a hostile takeover attempt by a colorful corporate raider of that era named T. Boone Pickens. I ended up spending months going back and forth from New York to Washington with Nick. A few years later, Nick Brady became the Treasury Secretary. Nick asked me to join him at Treasury, which opened the door for me to higher levels of public service. The point is this: if I had not forced myself to get up from my desk, taken the stairs up to the fifteenth floor, and presented myself at his office that day, the rest of my life would have been very different, and I would not be standing here today. Mustering that little bit of initiative changed my life. A little initiative can make all the difference in anyone's career. I'll conclude by encouraging you to think beyond yourselves. Each of you has the capability to achieve success in any field you choose. It's important that you also consider how to give back and use your gifts to make a difference. Reflect on the motto of this school: "Law is but the means, justice is the end." Many of you have served at law clinics, where you stood up for underrepresented individuals and organizations, and many of you will play important roles in the military, at nonprofits, and in governments around the world. Each generation has an obligation to move us closer to the ideal, as embodied by the famous image of blindfolded Lady Justice holding the scales. You should count yourselves among the luckiest in all our society to graduate from this institution, to have the support of loved ones through three grueling years, and the health and other good fortune not to get tripped up along the way. Several years ago, one of my predecessors, Ben Bernanke, said, "Those who are the luckiest also have the greatest responsibility to work hard, to contribute to the betterment of the world, and to share their luck with others." I can't improve upon that. I thank you for having me. Georgetown will always hold a special place in my heart. Thank you again to Dean Treanor and all the faculty, and the heartiest of congratulations to the Class of 2024.