Last month, the Federal Reserve Board submitted its semiannual report on monetary policy to the Congress. That report and my accompanying testimony covered in detail our assessment of the outlook for the U.S. economy. This morning, I would like to highlight some of the key aspects of the current economic situation.
3. Implications for financial stability policy  What do these developments mean for financial stability policy? In the new environment, risks seem to be dispersed more widely, but transparency about where risks are located has declined. This reduces the sectoral impact of real and financial shocks, but may also make it harder to anticipate which sectors are vulnerable to a shock.