See Hie Joo Ahn and Chad Fulton (2020), “Index of Common Inflation Expectations,” FEDS Notes (Washington: Board of Governors of the Federal Reserve System, September 2), https://www.federalreserve.gov/econres/notes/fedsnotes/index-of-common-inflation-expectations-20200902.htm; and Jeremy Rudd (2020), “Underlying Inflation: Its Measurement and Significance,” FEDS Notes (Washington: Board of Governors of the Federal Reserve System, September 18), https://www.federalreserve.gov/econres/notes/fedsnotes/underlying-inflation-its-measurement-and-significance-20200918.htm.
- 13 recovery will dictate the actual path of monetary policy, as implied by the conditional outcome-based forward guidance adopted in September. Indeed, a key benefit of outcome-based forward guidance is that it conveys the Committee’s monetary policy reaction function in a manner that is transparent and responsive to changes in economic conditions.