Passive Aggressive

At the upcoming meeting of the Federal Open Market Committee (FOMC) on June 12 to 13, Chair Yellen will remain the dominant voice on the design of monetary policy. FOMC participants will bend to her preference for well-telegraphed, modest policy hikes at each of its four press-conference meetings. This lays a brick foundation for a staircase along which the federal funds rate rises one percentage point per year, preserving Yellen’s preference for a lower-for-longer policy path. All along that predetermined climb, officials describe each decision as dependent on the data and made meeting by meeting.