Title: Monetary Policy Transparency and Accountability Act of 2017
Policy area: Economics and Public Finance

Summary:
Monetary Policy Transparency and Accountability Act of 2017
This bill amends the Federal Reserve Act to require the Federal Open Market Committee to annually publish its monetary policy strategy. The strategy must include short-term interest-rate targets, open-market operations, and earnings on Federal Reserve bank balances. The Chairman of the Federal Open Market Committee is required to report on such strategy semiannually.

[Congressional Bills 115th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4270 Introduced in House (IH)]

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115th CONGRESS
  1st Session
                                H. R. 4270

To amend the Federal Reserve Act to ensure transparency in the conduct 
              of monetary policy, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            November 7, 2017

   Mr. Barr introduced the following bill; which was referred to the 
                    Committee on Financial Services

_______________________________________________________________________

                                 A BILL


 
To amend the Federal Reserve Act to ensure transparency in the conduct 
              of monetary policy, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Monetary Policy Transparency and 
Accountability Act of 2017''.

SEC. 2. MONETARY POLICY TRANSPARENCY AND ACCOUNTABILITY.

    Section 12A of the Federal Reserve Act (12 U.S.C. 263) is amended--
            (1) by redesignating subsections (b) and (c) as subsections 
        (d) and (e), respectively; and
            (2) by inserting after subsection (a) the following new 
        subsections:
    ``(b) Policy Transparency.--
            ``(1) Monetary policy strategy.--
                    ``(A) In general.--The Committee shall annually 
                establish exactly 1 monetary policy strategy, which 
                shall serve as a non-technical public communication of 
                the Committee's consensus expectation for the conduct 
                of monetary policy during that calendar year.
                    ``(B) Requirements.--Each monetary policy strategy 
                of the Committee shall include the following:
                            ``(i) A plain English description of how 
                        the Committee would adjust each of the 
                        following monetary policy instruments in 
                        reaction to changes in a small and well-defined 
                        set of publicly available economic indicators:
                                    ``(I) Short-term interest rate 
                                targets established by the Committee.
                                    ``(II) Open-market operations 
                                authorized under section 14.
                                    ``(III) Earnings on balances 
                                maintained at a Federal reserve bank by 
                                or on behalf of a depository 
                                institution under section 19(b)(12).
                            ``(ii) An identification of 1 monetary 
                        policy instrument from the list in clause (i) 
                        that the Committee expects to use as the 
                        primary instrument for implementing the 
                        monetary policy strategy described under 
                        subparagraph (A).
            ``(2) Reference monetary policy rules.--In addition to the 
        monetary policy strategy required under paragraph (1), the 
        Committee shall annually adopt at least 1 and not more than 3 
        reference monetary policy rules, each of which shall 
        mathematically express how the primary monetary policy 
        instrument identified under paragraph (1)(B)(ii) reacts to 
        changes in a small and well-defined set of publicly available 
        economic indicators.
            ``(3) Deviations.--Nothing in this subsection shall be 
        construed to prevent the Committee from setting short-term 
        interest rate targets, conducting open-market operations, or 
        paying earnings on balances pursuant to section 19(b)(12) in a 
        manner that deviates from a monetary policy strategy or any 
        reference monetary policy rules established under this 
        subsection.
    ``(c) Testimony and Reports of the Chairman.--The Chairman shall, 
concurrent with each semi-annual hearing required under section 2B, 
submit a report to the Committee on Banking, Housing, and Urban Affairs 
of the Senate and the Committee on Banking and Financial Services of 
the House of Representatives, containing--
            ``(1) a statement as to whether the monetary policy 
        strategy established under subsection (b)(1) qualitatively 
        differs from any of the reference monetary policy rules 
        required under subsection (b)(2) and, if applicable, a full and 
        non-technical explanation of any such difference;
            ``(2) a statement as to whether the Committee's conduct of 
        monetary policy since the previous report quantitatively 
        differs from any reference monetary policy rule and, if 
        applicable, a full and non-technical explanation of any such 
        differences; and
            ``(3) a description of--
                    ``(A) the circumstances under which the Committee's 
                monetary policy strategy may be amended from year to 
                year; and
                    ``(B) a full and non-technical explanation of any 
                such actual amendment.''.
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