Full comparison of changes in the July meeting statement of the Federal Reserve

The Federal Reserve kept interest rates unchanged in July as expected. Compared to the statement from the June meeting, there were three major changes in the Federal Open Market Committee (FOMC) statement released by the Federal Reserve on Wednesday, July 31.

First, the description of the U.S. economic growth was revised from "still strong" to "slowed down somewhat," while the description of the unemployment rate remained "still at (historically) low levels" but added "has risen somewhat." The description of high inflation was toned down to "somewhat elevated," and the achievement of the 2% inflation target removed "moderate" progress, changing to "some further progress."

Second, in terms of the risk description for achieving full employment and the dual inflation target, there was an addition of affirmative wording towards "sustainably" moving towards better balance, removing the description of "over the past year moving towards better balance."

Most notably, although the statement acknowledged that the economic outlook remains uncertain, it removed the FOMC's wording of "still highly concerned about inflation risks" and added emphasis on "concerns about risks facing both the employment and price stability dual mandate," indicating a recent dovish turn in Federal Reserve officials' public speeches, expressing concerns that overly restrictive monetary policy could negatively impact the labor market.

Finally, Cleveland Fed President Mester retired at the end of June this year and did not participate in this meeting's vote. Chicago Fed President Evans was appointed as an alternate member to supplement the voting committee.

The full translation of the statement is as follows, with black text being the same parts as the June FOMC statement, black text with annotations added by Wall Street News, red text being the additions in July 2024, and blue text in parentheses being the deleted wording from the June statement (please indicate the source when reprinting):

Recent indicators show that economic activity continues to expand steadily. Employment growth has slowed somewhat (still strong), the unemployment rate has risen somewhat but remains low. Inflation has slowed somewhat over the past year but remains somewhat elevated. In recent months, some (moderate) progress has been made in achieving the Committee's (note: FOMC Committee) 2% inflation target.

The Committee (note: FOMC Committee) seeks to achieve maximum employment and a 2% inflation rate over the long term. The Committee assesses that the risks of achieving employment and inflation goals (over the past year) are continuing to trend towards better balance. The economic outlook is uncertain, and the Committee (still highly) focuses on (inflation risks) the risks facing both of its dual mandates.

To support its (note: FOMC Committee) goals, the Committee decided to maintain the target range for the federal funds rate at 5.25% to 5.50%. When considering any adjustments to the target range for the federal funds rate, the Committee will carefully assess future data, evolving outlooks, and risk balances. The Committee expects that it is not appropriate to lower the target range until it has more confidence in the continued progress towards 2% inflation. In addition, the Committee will continue to reduce its holdings of U.S. Treasury securities, agency debt, and agency mortgage-backed securities. The Committee remains committed to achieving the 2% inflation target When evaluating the appropriate monetary policy stance, the committee will continue to monitor the latest information on the impact on the economic outlook. If risks arise that could impede the achievement of the objectives, the committee will be prepared to adjust the monetary policy stance as appropriate. The committee's assessment will take into account a wide range of information, including labor market conditions, inflation pressures and expectations, as well as data on financial and international developments.

Those in favor of this monetary policy include: FOMC Chairman Jerome H. Powell (Note: Chairman of the Federal Reserve); Vice Chairman John C. Williams (Note: President of the New York Fed); Thomas I. Barkin (Note: President of the Richmond Fed); Michael S. Barr (Note: Federal Reserve Governor); Raphael W. Bostic (Note: President of the Atlanta Fed); Michelle W. Bowman (Note: Federal Reserve Governor); Lisa D. Cook (Note: Federal Reserve Governor); Mary C. Daly (Note: President of the San Francisco Fed); Austan D. Goolsbee (Note: President of the Chicago Fed); Philip N. Jefferson (Note: Federal Reserve Governor); Adriana D. Kugler (Note: Federal Reserve Governor); [Loretta J. Mester (Note: President of the Cleveland Fed)]; Christopher J. Waller (Note: Federal Reserve Governor). Austan D. Goolsbee voted as an alternate member at this meeting