Employment and stable prices concern people whose needs need not align neatly. In its March 15, 2017 statement, the Federal Reserve raised the federal funds target to 0.75–1 percent while describing policy as still accommodative. It connected the decision to labour-market conditions and inflation. That explanation gives an interfaith and secular ethics discussion something concrete to examine, rather than an invitation to bless or condemn debtors. [monetary20170315a]

The Committee said inflation had approached its 2 percent longer-run objective, while inflation excluding food and energy remained somewhat below that level. It also reported a strengthening labour market. These were the institution's assessments supporting a choice between public responsibilities. They do not establish how any particular family weighed employment prospects against the purchasing power of its income. [monetary20170315a]

The implementation note makes the choice less abstract. Interest on required and excess reserve balances would become 1 percent on March 16; the primary credit rate would become 1.50 percent. These operational rates are not moral rankings of savers and borrowers. Our ethical interpretation is that evaluating stewardship requires identifying the instrument and the people it directly addresses before claiming broader fairness. [monetary20170315a1]

Neel Kashkari dissented, preferring no change to the existing target at that meeting. Recording that disagreement matters: a shared concern for human welfare does not imply one agreed policy timing. Religious and nonreligious readers can examine the stated reasons without claiming that their traditions unanimously endorse the decision. The two Fed texts explain a choice and its machinery, but leave the distribution of its actual benefits and burdens unmeasured. [monetary20170315a][monetary20170315a1]

Source documents

  1. Federal Reserve issues FOMC statementhttps://www.federalreserve.gov/newsevents/pressreleases/monetary20170315a.htm
  2. Implementation Note issued March 15, 2017https://www.federalreserve.gov/newsevents/pressreleases/monetary20170315a1.htm