karnit flug : strengths and challenges facing the israeli economy main points of remarks by dr karnit flug, governor of the bank of israel, at the jerusalem ultra - orthodox campus of ono academic college, jerusalem, 1 december 2014. * * * the israeli economy is an open economy that is greatly influenced by developments abroad, which is reflected in growth rates in the economy, which are very much connected to those around the world. the influence of activity abroad is mainly reflected in global trade, which affects demand for israeli exports, both in goods and in services. goods exports are in a virtual standstill, due to the standstill in global trade. they declined slightly in 2013 and recovered slightly during 2014. services exports showed better performance than global trade in services – meaning that the state of manufacturing was more serious than the state of the services industries, which is also a result of developments in the exchange rate. the labor market is in relatively good condition, with the unemployment rate at very low levels despite the continuing trend in the labor force participation rate, and the result is a trend of increase in the employment rate. this is a different picture than what other countries are experiencing, and an indication that the labor market is showing relative robustness, as is also reflected in an international comparison of unemployment rates. bank of israel policy acts to achieve the bank of israel ’ s objectives as defined by law. the main objective is to attain price stability, meaning meeting the inflation target and, subject to that, supporting other economic objectives such as growth, employment, and financial stability. in recent months, the inflation rate has been below the target range, and in the past 12 months, prices have declined by 0. 3 percent. the main reason for this is the decline in commodities prices abroad, reflecting stagnation in the global economy, apparently low demand abroad, and relatively moderate demand in the israeli economy. even though we have not seen a decline in private consumption, we have seen a decline in investments and in exports. until a few months ago, there was also a sharp appreciation of the shekel, which also contributed to lower prices. the appreciation also made it difficult for israeli exporters to compete in the global economy, and it therefore definitely bothered us at the bank of israel. monetary policy ’ s response to these developments was a prolonged reduction in the interest rate, to the historically low level of 0. 25 percent, and foreign exchange purchases that acted to moderate the appreciation of the shekel.

for release on delivery 11 : 45 a. m. edt october 19, 2020 u. s. economic outlook, monetary policy, and initiatives to sustain the flow of credit to households and firms remarks by richard h. clarida vice chair board of governors of the federal reserve system at the unconventional convention of the american bankers association washington, d. c. ( via webcast ) october 19, 2020 it is my pleasure to meet virtually with you today at the unconventional convention of the american bankers association. 1 i look forward to my conversation with rob nichols, but first, please allow me to offer a few remarks on the economic outlook, federal reserve monetary policy, and some of the initiatives we have announced to support the flow of credit to households and firms during these challenging times. current economic situation and outlook in the first half of this year, the covid - 19 ( coronavirus disease 2019 ) pandemic and the mitigation efforts put in place to contain it delivered the most severe blow to the u. s. economy since the great depression. gross domestic product ( gdp ) collapsed at an almost 32 percent annual rate in the second quarter, and more than 22 million jobs were lost in march and april. this recession was by far the deepest one in postwar history, but it also may go into the record books as the briefest recession in u. s. history. the flow of macrodata received since may has been surprisingly strong, and gdp growth in the third quarter is estimated by many forecasters to have rebounded at roughly a 30 percent annual rate. this development is especially noteworthy when set in relief against the surge in new covid - 19 cases that were reported this summer in a number of u. s. states and the coincident flatlining in a number of high - frequency activity indicators that we follow to track the effect of the virus on economic activity. although spending on many services continues to lag, the rebound in the gdp data has been broad based across indicators of goods consumption, housing, and investment. these components of aggregate demand have benefited from robust fiscal the views expressed are my own and not necessarily those of other federal reserve board members or federal open market committee participants. i would like to thank chiara scotti for her assistance in preparing these remarks. - 2support — including expanded unemployment benefits and the small business administration ’ s paycheck protection program ( ppp ) — as well as low interest rates and efforts by the federal reserve to sustain