supply shocks to food, energy, labor, or semiconductors, we have both the capacity and the responsibility to maintain anchored inflation expectations and price stability. see ricardo reis ( 2022 ), “ the burst of high inflation in 2021 – 22 : how and why did we get here? ” working paper. - 8we are in this for as long as it takes to get inflation down. so far, we have expeditiously raised the policy rate to the peak of the previous cycle, and the policy rate will need to rise further. as of this month, the maximum monthly reduction in the balance sheet will be nearly double the level of the previous cycle. 10 together, the increase in the policy rate and the reduction in the balance sheet should help bring demand into alignment with supply. monetary policy will need to be restrictive for some time to provide confidence that inflation is moving down to target. the economic environment is highly uncertain, and the path of policy will be data dependent. while the precise course of action will depend on the evolution of the outlook, i am confident we will achieve a return to 2 percent inflation. our resolve is firm, our goals are clear, and our tools are up to the task. as of september 2022, the monthly caps on the runoff of treasury securities and mortgage - backed securities are $ 60 billion and $ 35 billion per month, as compared with $ 30 billion and $ 20 billion, respectively, from 2017 to 2019.

pressures and with longer - term inflation expectations stable, i anticipate that the subdued trend in inflation that we have seen for the past two years will continue. summary and policy outlook combining the various factors likely to influence the path of economic activity this year, including importantly the outlook for financial markets, i expect that the economic recovery will continue at a moderate pace. as the year goes on, i anticipate that we will see more signs that the improvements in financial markets, credit conditions, and business sales are reinforcing each other, leading to greater confidence and improving the prospects for 2011. even as economic activity strengthens, however, levels of resource utilization are likely to remain below historical norms for some time. as a result, cost pressures should be contained, inflation expectations should continue to be stable, and inflation is likely to remain subdued. in the current environment, the fomc continues to anticipate that economic conditions are likely to warrant exceptionally low levels of the federal funds rate for an extended period. such policy accommodation is warranted to provide support for a return over time to more desirable levels of real activity and unemployment in the context of price stability. in addition, the federal reserve is committed to continue working with banks and bank holding companies to facilitate the flow of credit to consumers and businesses. of course, if economic conditions and the economic outlook were to change significantly, the outlook for policy would need to be adjusted as well. we have a wide range of tools for removing monetary policy accommodation when that becomes appropriate. the committee will evaluate the appropriate stance of policy in light of the evolving economic outlook and conditions in financial markets, with the aim of fostering maximum employment and price stability.