Fed Chair Powell Signals Potential Monetary Policy Framework Changes

Federal Reserve Chair Jerome Powell announced that the central bank is considering key changes to its monetary policy framework. Speaking at a research conference on May 15th, 2025, Powell stressed the importance of maintaining anchored inflation expectations and the need for transparent communication, especially in times of uncertainty. He stated, "Anchored expectations are critical to everything we do." The Fed is reviewing the 2020 framework and plans to update the consensus statement in the coming months. These changes reflect lessons learned from recent economic events and aim to improve communication about the economy's outlook. This move signals a proactive approach to managing economic uncertainty and maintaining public trust in the Federal Reserve.