FRBSF University Symposium
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Transcript of FRBSF University Symposium
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FRBSF University Symposium
Board of Governors
Governor Randall S. Kroszner
Chris ClarkHeidi Downs
Travis George Jim MignanoFinian Small
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Current US Economic Conditions • Deceleration of GDP growth
– Consumer spending slowing down– Decrease in residential investment
•Largest decrease since 1991– Inflation is still under control
FRBSF University Symposium
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Current US Economic Conditions
FRBSF University Symposium
Percentage Change in Real GDP and Related Measures
-20
-15
-10
-5
0
5
10
15
20
25
2004-Q1 2004-Q2 2004-Q3 2004-Q4 2005-Q1 2005-Q2 2005-Q3 2005-Q4 2006-Q1 2006-Q2 2006-Q3
GDPRes. Fixed InvestmentPersonal Consumption ExpendituresGross Private Domestic InvestmentGovernment Spending
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Current US Economic Conditions
• Fed Funds Rate: 5.25%
• Low unemployment
• Personal income increased
FRBSF University Symposium
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Current International Conditions • Improving current account
– Shrinking trade deficits
• Worsening capital account– Shrinking capital and investment net
inflow surpluses
FRBSF University Symposium
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Summary of Decision
• Domestic conditions are stable
• International markets are moving toward equilibrium
• A rate increase would only serve to disrupt natural market corrections
FRBSF University Symposium