How the Fed Adjusts the Fed Funds Rate within Its Target Range

Gara Afonso, Lorie Logan, Antoine Martin, Will Riordan and Patricia Zobel
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Lorie Logan: https://www.dallasfed.org/fed/leadership/Logan.aspx

No 20220112, Liberty Street Economics from Federal Reserve Bank of New York

Abstract: At its June 2021 meeting, the FOMC maintained its target range for the fed funds rate at 0 to 25 basis points, while two of the Federal Reserve’s administered rates—interest on reserve balances and the overnight reverse repo (ON RRP) facility offering rate—each were increased by 5 basis points. What do these two simultaneous decisions mean? In today’s post, we look at “technical adjustments”—a tool the Fed can deploy to keep the FOMC’s policy rate well within the target range and support smooth market functioning.

Keywords: technical adjustments; monetary policy implementation (search for similar items in EconPapers)
JEL-codes: E52 E58 (search for similar items in EconPapers)
Date: 2022-01-12
New Economics Papers: this item is included in nep-cwa, nep-his, nep-mac and nep-mon
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