15 basis points. - 6when it is credible, financial markets price those expected actions into today ’ s interest rates. by instantly pricing in future policy, promised rate hikes immediately affect many of the costs of financing for households and firms, even though the actual policy rate hasn ’ t moved. as a result, policy tightening occurs with the announcement of policy tightening, not when the rate change actually happens. as an illustration, look at how the two - year treasury yield moved between late 2021 and march 2022, a time when the fomc was talking about lifting the policy target range above zero. i have argued in the past that the two - year treasury yield is a good proxy for the stance of monetary policy and captures announcement effects. 3 the 2 - year yield went from 25 basis points in september 2021 to around 200 basis points by the march 2022 fomc meeting. even though we had not raised the policy rate nor did we get the policy rate up to 200 basis points until august 2022, the markets priced in a nearly 200 basis point increase in the expected policy rate before we actually raised it. this forward guidance effectively shaved off about 6 months from the usual 12 - to 24 - month lag that one might conjecture would be needed to see the 200 basis points of actual tightening affect the economy. 4 that is, forward guidance shortens the lag time between when the policy rate changes and when the effects of actual policy tightening occur. now let me turn to the second question, whether the size of the shock matters for estimating lags in policy. in the standard linear models used for these exercises, the size see christopher j. waller ( 2022 ), “ reflections on monetary policy in 2021, ” speech delivered at the 2022 hoover institution monetary conference, stanford, calif., may 6, https : / / www. federalreserve. gov / newsevents / speech / waller20220506a. htm. recent analysis by fed economists shows the announcement effects of policy have in fact led to a shortening in monetary policy lags. see taeyoung doh and andrew t. foerster ( 2022 ), “ have lags in monetary policy transmission shortened? ” federal reserve bank of kansas city, economic bulletin, december 21, https : / / www. kansascityfed. org / research / economic - bulletin / have - lags - in - monetary - policytransmission - shortened /

low - and moderate - income individuals, including those who are considered unbanked. having a bank account provides the means to receive, transact, and safely save funds. it is also a pathway for a bank customer to - 8implement laws to promote fair lending, consumer protection, and transparency in the consumer financial services marketplace. let me say a bit about where innovation fits into this goal of making the financial system fairer. we should welcome financial innovation as a positive force that can increase access and lower costs for individuals and businesses. that said, innovation can also introduce new risks for consumers. we have already seen occasions when uses of new technologies and data can raise serious concerns about violations of fair lending laws. 8 as innovative financial products develop and grow rapidly, excitement can outrun the proper assessment of risk. as we have seen with the growth of crypto assets, in a rapidly rising and volatile market, participants may come to believe that they understand new products only to learn that they don ’ t, and then suffer significant losses. crypto - asset related activity, both outside and inside supervised banks, requires oversight so that people are fully aware of the risks they face. we plan to work with other bank regulatory agencies to ensure that crypto activity inside banks is well regulated, based on the principle of same risk, same activity, same regulation, regardless of the technology used for the activity. i plan to make sure that the crypto activity of banks that we supervise is subject to the necessary safeguards that protect the safety of the banking system as well as bank customers. banks engaged in crypto - related activities need to have appropriate measures in place to manage novel risks associated with those activities and to ensure compliance with all relevant laws, including those related to money laundering. establish an ongoing relationship with a bank. moreover, a bank account provides the cash flow data that some financial companies use to underwrite credit. one important way the fed encourages greater access to deposit products is by giving banks credit under the community reinvestment act ( cra ) for offering lowcost deposit accounts to low - or moderate - income individuals. in addition, several reserve banks also participate in the bank on initiative, a nationwide effort ( with 90 local coalitions ) to move the unbanked into the banking system by promoting access to safe, standardized low - cost transactional accounts. united states v. meta platforms, inc., no. 1 : 22 - cv - 05187 ( s. d