The example of the Fed also vividly illustrates how the communication of monetary policy has been in constant flux. Before 1994, the Federal Open Market Committee (FOMC) provided no information on the federal funds target rate – the Fed’s key interest rate. From 1994 onwards, statements were published for each change in the target rate.
From the end of 1999, the FOMC issued a statement after every meeting, which also revealed voting results from 2002 onwards. From 2003, the statements also contained explicit information, or forward guidance, on the likely course of inflation. Since 2007, the FOMC has published individual projections for its members’ growth, unemployment, inflation and interest rates four times per year.