Voting against the policy was Thomas M. Hoenig, who judged that the economy continues to recover at a moderate pace. Accordingly, he believed that continuing to express the expectation of exceptionally low levels of the federal funds rate for an extended period was no longer warranted and will lead to future imbalances that undermine stable long-run growth. In addition, given economic and financial conditions, Mr. Hoenig did not believe that continuing to reinvest principal payments from its securities holdings was required to support the Committee’s policy objectives.
Eric Rosengren, Boston Fed
If further policy accommodation is needed to promote price stability and the continuation of the economic recovery, we have options available to us. We are in uncharted waters. History does not provide a complete guide for the unconventional policy tools we are using, which is why it is important that we continue to examine the costs and benefits of these tools. If additional accommodation is needed, I want to be sure that the framework we employ is an effective one. I am confident that the Federal Reserve can effectively respond to evolving economic and financial developments.
We have tools that can provide additional stimulus at costs that do not appear to be prohibitive. Thus, I conclude that further action is likely to be warranted unless the economic outlook evolves in a way that makes me more confident that we will see better outcomes for both employment and inflation before too long.