My colleagues and I typically look through the effects on inflation of fluctuations in oil prices and the dollar because these effects tend to be transitory.
However, we became concerned in 2015 about the risk that part of the decline in inflation could prove to be longer lasting, especially given that inflation had already been running below our 2 percent objective for quite some time.10 These various considerations, along with our reassessment of longer-run economic conditions—which I will discuss shortly—explain why the Committee ended up raising the target range for the federal funds rate only 1/4 percentage point in 2015, substantially less than the full percentage point increase suggested by the median projection of FOMC participants reported in June 2014.