FILE - In this March 5, 2009, file photo, Job seekers join a line of hundreds of people at a job fair sponsored by Monster.com in New York. The Federal Reserve projects the unemployment rate will stay elevated until late 2015, suggesting it will keep short-term interest rates low for the next three years. (AP Photo/Mark Lennihan)
-
FILE - In this March 5, 2009, file photo, Job seekers join a line of hundreds of people at a job fair sponsored by Monster.com in New York. The Federal Reserve projects the unemployment rate will stay elevated until late 2015, suggesting it will keep short-term interest rates low for the next three years. (AP Photo/Mark Lennihan)
-
FILE - In this Wednesday, Dec. 12, 2012 file photo, Federal Reserve Chairman Ben Bernanke speaks during a news conference at the Federal Reserve Board in Washington. Federal Reserve policymakers expressed broad support in December 2012 for the Fed's plan to buy bonds to support the U.S. economy. But they differed over how long to keep buying bonds to drive down long-term interest rates. Minutes of the Fed's December policy meeting show that some of the 12 voting members thought the bond purchases would be warranted through the end of 2013. (AP Photo/Manuel Balce Ceneta, File)
-
Federal Reserve Chairman Ben Bernanke speaks during a news conference at the Federal Reserve Board in Washington, Wednesday, Dec. 12, 2012, following the Federal Open Market Committee meeting. The Federal Reserve sent its clearest signal to date Wednesday that it will keep interest rates super-low to boost the U.S. economy even after the job market has improved significantly. (AP Photo/Manuel Balce Ceneta)
-
FILE - In this June 9, 2010, file photo, Federal Reserve Chairman, Ben Bernanke, right, listens with president of the Federal Reserve of Richmond, Jeffrey Lacker, left, at J. Sergeant Reynolds Community College in Richmond, Va. With an eye on the “fiscal cliff,” the Federal Reserve is expected to announce a new bond-buying plan to support the U.S. economy on Tuesday, Dec. 11, 2012. Lacker has said he thinks the job market is being slowed by factors beyond the Fed's control and he says further bond purchases risk worsening future inflation. (AP Photo/Steve Helber, File)
-
FILE- This March 27, 2009, file photo, shows the Federal Reserve Building on Constitution Avenue in Washington. With an eye on the “fiscal cliff,” the Federal Reserve is expected to announce a new bond-buying plan to support the U.S. economy on Tuesday, Dec. 11, 2012. (AP Photo/J. Scott Applewhite, File)
-
FILE-In this Tuesday, Aug. 7, 2012, file photo, Federal Reserve Chairman Ben Bernanke speaks to educators in the board room of the Federal Reserve in Washington. Federal Reserve officials spoke with increased urgency Wednesday, Aug. 22, 2012, at their last meeting about the need to provide more help for a weak U.S. economy. The minutes of the July 31-Aug. 1 meeting show many members feeling further support would be needed "fairly soon" unless the economy improved significantly. (AP Photo/Manuel Balce Ceneta)
-
This combination of Associated Press Photos shows the four new voting members on the Federal Reserve policy committee from top left, Esther George, James Bullard, Charles Evans, and Eric Rosengren. The cast of voting members on the Federal Reserve's policy committee is changing this year, but their policies probably won't be as Chairman Ben Bernanke will likely retain a solid majority on the 12-member committee for his drive to keep interest rates low well into the future despite critics who worry about the risks. (AP Photo)
-
FILE - In this Thursday, Sept. 13, 2012, file photo, Federal Reserve Chairman Ben Bernanke speaks during a news conference in Washington. The cast of voting members on the Federal Reserve's policy committee is changing this year, but their policies probably won't be as Chairman Ben Bernanke will likely retain a solid majority on the 12-member committee for his drive to keep interest rates low well into the future. (AP Photo/Manuel Balce Ceneta, File)
Fed to change timing of policy statement
WASHINGTON (
AP) — The Federal Reserve is changing its schedule for issuing policy statements, a shift that will give Chairman
Ben Bernanke an opportunity to better control the message it sends to financial markets.
The Fed will now issue a statement at 2 p.m. Eastern time for all eight meetings. Four of those meetings will be followed by a Bernanke news conference at 2:30 p.m.
Prior to the change, nearly two hours passed between when the statement was issued and Bernanke's news conference began.
By reducing the time in between, Bernanke can more quickly manage how the statement is interpreted. Investors scrutinize the Fed's words for signals of when it might start raising interest rates.
The time changes will go into effect at the Fed's next meeting on March 19-20.
"They probably did some research and said the market has periods of increased volatility right after the announcement," said Robert Pavlik, chief market strategist at Banyan Partners. "Well, of course there's going to be. That's the way it works."
Many economists believe Fed officials will maintain their low-interest rate policies at current levels but take no new steps at the March meeting.
In January, the Fed stood behind aggressive steps it launched in December to try to reduce unemployment. It repeated that it would keep its key short-term interest rate at a record low at least until unemployment falls below 6.5 percent. And the Fed said it would keep buying Treasurys and mortgage bonds to help lower borrowing costs and encourage spending.
The unemployment rate fell to a four-year low of 7.7 percent last month, down from 7.9 percent in January when the Fed last met.
Critics, including some regional Fed bank presidents, have expressed worries that the Fed's policies could hasten inflation. But Bernanke has sent signals recently that he plans to keep continue the Fed's aggressive policies until there is a substantial improvement in the job market.
The Fed only started to release brief policy statements after its meetings in 1994. Before then, markets had to guess at the Fed's intentions on interest rates. In 2011, Bernanke went further by holding regular news conferences, a first for a Fed chairman.
"They are trying to be more open and work with the market to some degree. It's probably a good thing," said Pavlik. "You don't want to give away the store but to try to get their message across so that people can understand it in real time makes a lot of sense. Maybe, if they could put it in language that the average man can understand, instead of double-Fed-talk, it would probably make even more sense."
___
AP Markets Writer Steve Rothwell contributed to this report.
Tags:
ap, federal reserve, fed, ben bernanke, chairman ben bernanke, milton friedman, bernanke, science_technology, opportunity, rates, unemployment rate, message, spending, economics, worries, job market, percent, good thing, schedule, financial markets, federal reserve system, time, sense, inflation, unemployment, great depression, washington, monetary policy, shift, meeting, volatility, real time, current levels, chief market strategist, meetings, new steps, lower borrowing costs, short-term interest rate, eastern time, signals, mortgage bonds, writer steve rothwell, time changes, aggressive steps, fed officials, chairman of the federal reserve, average man, low-interest rate policies, fed chairman, robert pavlik, banyan partners, substantial improvement, regional fed bank, better control, policy statements, bernanke news conference, brief policy statements, regular news conferences
Print Page
