FOMC Policy on External Communications of Federal Reserve

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					FOMC Policy on External Communications of Federal Reserve System
Staff ¹
as adopted June 22, 2011

PREAMBLE1                                                  GENERAL PRINCIPLES

   In the course of making monetary policy                 1. Federal Reserve staff play a significant
decisions, the Federal Open Market Commit-                 role in enhancing public understanding of the
tee (FOMC) makes extensive use of back-                    FOMC’s actions, thereby promoting the effec-
ground materials prepared by the staff of the              tiveness of monetary policy. In all communi-
Federal Reserve System, and senior staff give              cations with the public regarding monetary
regular briefings at FOMC meetings. In addi-               policy issues, members of the official staff
tion, staff are directly involved in the imple-            should refrain from publicly expressing their
mentation and communication of the Commit-                 own personal views regarding prospective
tee’s policy decisions.                                    monetary policy decisions and should never
   Federal Reserve System staff have contacts              speculate about future monetary policy deci-
with members of the public in the process of               sions or actions that have not been announced
gathering information about current economic               by the Committee. In explaining the rationale
and financial conditions. In addition, staff               for announced FOMC decisions, staff should
synthesize that information using a variety of             draw on Committee communications, the
analytical methods and statistical tools, and              Chairman’s press conference remarks, and
the continual refinement of these methods and              other published materials as appropriate.
tools is facilitated by ongoing interactions               Whenever staff make public comments on
with academic researchers, staff at foreign                monetary policy, they should clearly indicate
central banks, and other outside analysts. Fi-             that those comments are solely their own re-
nally, staff play a significant role in helping            sponsibility and should not be interpreted as
the public understand the rationale for FOMC               representing the views of the FOMC, its prin-
decisions.                                                 cipals, or any other person associated with the
   To reinforce the public’s confidence in the             Federal Reserve System.
transparency and integrity of the monetary                 2. To foster the ongoing frank exchange of
policy process, the FOMC has established the               views at FOMC meetings, staff will refrain
following principles to govern the public con-             from characterizing such discussions—apart
tacts of Federal Reserve System staff who                  from what has been published in the minutes
have access to confidential FOMC informa-                  of each FOMC meeting—in any contact with
tion.2 The FOMC maintains responsibility for               an individual, firm, or organization outside of
ensuring that all System staff abide by these              the Federal Reserve System.
principles. Specifically, the President of each            3. To protect the independence of the
Federal Reserve Bank is responsible for ensur-             FOMC’s decision-making process from short-
ing the confidentiality of FOMC information                term political pressures, members of the offi-
at that Bank and for the conduct and discretion            cial staff will strive to avoid any appearance
of that Bank’s staff with regard to the use of             of political partisanship in their contacts with
that information, and the Chairman fulfills this           the public.
role for Board staff.                                      4. Staff will carefully safeguard all confi-
                                                           dential FOMC information.3 No confidential
                                                           information may be released except pursuant

   This document complements the FOMC policy
regarding the external communication of Commit-                The Committee’s regulations concerning the de-
tee participants, which is set forth in a separate         signation and handling of confidential FOMC in-
document.                                                  formation are set forth in a separate document,
   This policy is fully consistent with and comple-        “Program for Security of FOMC Information,”
ments the rules for ethical conduct prescribed for         available at
the staff of the Board of Governors and for staff at       tarypolicy/files/FOMC_InformationSecurityProg
each Federal Reserve Bank.                                 ram.pdf.

                        FOMC Policy on External Communications of Federal Reserve System Staff

to Committee instructions or with written au-         following contacts would generally be consis-
thorization from the Chairman and prompt              tent with the Committee’s policy on external
notification to the Committee.                        communications, as long as the staff member
5. To ensure that no member of the public             carefully adheres to all of the principles listed
is able to profit financially from acquiring          above during the contact itself:
nonpublic information about economic and                 1. A presentation at a widely-attended
financial conditions or about the methods and            meeting, where the event is organized by a
tools that are currently being used to assess            non-profit entity and does not involve fund-
those conditions, staff will not provide such            raising. Such a meeting might be sponsored
information to any individual, firm, or organi-          by an academic institution, non-profit or-
zation outside of the Federal Reserve System             ganization, or civic or trade association
unless the information has been cleared for              (such as a chamber of commerce or a state
publication and is made widely available to              or national bankers’ association).
the public.                                              2. A private meeting with members of
6. Staff will strive to ensure that their con-           the public—such as bankers, community
tacts with members of the public do not pro-             representatives, industry representatives, or
vide any profit-making person or organization            labor representatives—to collect informa-
with a prestige advantage over its competitors.          tion about current economic and financial
They will consider this principle carefully and          conditions, without disseminating any in-
rigorously in considering invitations to speak           formation that is not widely available to the
at meetings sponsored by profit-making or-               public. Whenever practical, at least two
ganizations and in scheduling meetings with              Federal Reserve staff should be present at
anyone who might benefit financially from                such a meeting.
apparently-exclusive contacts with Federal               In contrast, the following contacts would
Reserve staff.                                        not be consistent with the principles set out
7. To facilitate the effectiveness of the             above:
Committee’s policy deliberations and the clar-           1. Disclosure of confidential FOMC in-
ity of its communications, staff observe the             formation.
blackout period on monetary policy commu-                2. Disclosure or characterization of the
nication that begins on the Tuesday morning              views expressed at an FOMC meeting.
of the week prior to each regularly-scheduled            3. Disclosure of an FOMC participant’s
FOMC meeting and ends at midnight Eastern                personal views on monetary policy that
Time on the Thursday following the meeting.              have not previously been communicated to
During each blackout period, staff refrain               the public.
from providing information to members of the             4. Public communications in which a
public about macroeconomic or financial de-              Federal Reserve officer expresses personal
velopments or about current or prospective               opinions about prospective monetary policy
monetary policy issues unless that information           decisions.
has already been cleared for publication and             5. A prediction to members of the public
made widely available to the public prior to             about Committee action prior to the Com-
the blackout period.                                     mittee’s announcement of such decisions.
                                                         6. A private meeting with selected
PRACTICAL EXAMPLES                                       clients of a regulated entity or financial firm
                                                         to discuss monetary policy.
  To assist Federal Reserve System staff in              Of course, the foregoing examples are not
understanding the application of these prin-          intended to serve as an exhaustive list, and
ciples, the FOMC has considered how the               hence good judgment will be essential in ap-
principles should be applied to some common           plying these principles. Moreover, whenever
requests for public contact. For example, the         staff are unsure about whether specific con-

                        FOMC Policy on External Communications of Federal Reserve System Staff

tacts with the public would be appropriate,            in the case of staff at the Board of Governors,
they should consult in advance with the ap-            and the President in the case of staff at a Fed-
propriate staff person or with the head of their       eral Reserve Bank.
respective institution—namely, the Chairman