Our Executive Committee, consisting of senior members of management and chaired by the Governor, is responsible for the formulation of monetary policy. In many countries, the setup is to have a legally constituted Monetary Policy Committee, where membership is not restricted to members of management. In my view this is a better arrangement and going forward, we should move to a similar arrangement.
The Committee did not adjust the target range in January. The decision in December to raise the federal funds rate reflected the Committee’s assessment that, even after a modest reduction in policy accommodation, economic activity would continue to expand at a moderate pace and labor market indicators would continue to strengthen.