in order to anchor expectations at the 2 percent level consistent with price stability, it “ seeks to achieve inflation that averages 2 percent over time, ” and — in the same sentence — that therefore “ following periods when inflation has been running persistently below 2 percent, appropriate monetary policy will the statement is available on the board ’ s website at https : / / www. federalreserve. gov / monetarypolicy / review - of - monetary - policy - strategy - tools - andcommunications - statement - on - longer - run - goals - monetary - policy - strategy. htm. - 5likely aim to achieve inflation moderately above 2 percent for some time. ” as chair powell indicated in his jackson hole remarks, we think of our new framework as an evolution from “ flexible inflation targeting ” to “ flexible average inflation targeting. ” 5 while this new framework represents a robust evolution in our monetary policy strategy, this strategy is in service to the dual - mandate goals of monetary policy assigned to the federal reserve by the congress — maximum employment and price stability — which remain unchanged. 6 concluding remarks while our interest rate and balance sheet tools are providing powerful support to the economy and will continue to do so as the recovery progresses, it will take some time for economic activity and employment to return to levels that prevailed at the business cycle peak reached last february. we are committed to using our full range of tools to support the economy and to help ensure that the recovery from this difficult period will be as robust as possible. see jerome h. powell ( 2020 ), “ new economic challenges and the fed ’ s monetary policy review, ” speech delivered at “ navigating the decade ahead : implications for monetary policy, ” a symposium sponsored by the federal reserve bank of kansas city, held in jackson hole, wyo. ( via webcast ), august 27, https : / / www. federalreserve. gov / newsevents / speech / powell20200827a. htm. see richard h. clarida ( 2020 ), “ the federal reserve ’ s new monetary policy framework : a robust evolution, ” speech delivered at the peterson institute for international economics, washington ( via webcast ), august 31, https : / / www. federalreserve. gov / newsevents / speech / clarida20200831a. htm ; and richard h. clarida ( 2020 ), “ the federal reserve ’ s new

. s. dollar led to an appreciation of the currency from mid - 2014 to mid - 2015 in an economy that was already slowing. attempts to offset the effects of this undesired appreciation have had mixed results. discontinuity around the zero lower bound if the research is correct in concluding that the channels for spillovers do not differ, these episodes should have played out little differently for conventional policy changes than they did for unconventional policy. that raises the question of why announcements of new policy actions around the zero lower bound have elicited such intense reactions. the launch of the federal reserve ’ s second asset purchase program in november 2010, for instance, sparked a blistering response from several foreign policymakers. one foreign finance ministry official was famously quoted as denouncing it as “ clueless, ” while others dubbed it the start of a “ currency war. ” officials from emerging markets with managed exchange rates argued that the united states “ has not fully taken into consideration the shock of excessive capital flows to the financial stability of emerging markets. ” 5 see, for instance, steven hill ( 2010 ), “ germany speaks out, ” op - ed, new york times, november 13, www. nytimes. com / 2010 / 11 / 13 / opinion / 13iht - edhill. html? _ r = 0 ; jonathan wheatley and peter garnham ( 2010 ), “ brazil in ‘ currency war ’ alert, ” financial times, september 15 ; and newsmax finance ( 2010 ), “ china : fed easing may flood world economy with ‘ hot money ’, ” newsmax media, november 8, www. newsmax. com / finance / streettalk / china - fed - easing - flood / 2010 / 11 / 08 / id / 376288. bis central bankers ’ speeches the reaction was just as striking – albeit in the opposite direction – when the federal reserve first announced its intention to taper asset purchases in 2013. the taper talk coincided with a broad reassessment of prospects in several large emerging markets in which some combination of financial, fiscal, and external imbalances had been building for some time. spillovers through financial channels were immediate despite the fact that the anticipated reduction in asset purchases in the united states was expected to take place gradually sometime in the future. my conjecture is that the widespread perception that unconventional monetary policy has large and disruptive spillovers may be a reflection of the discontinuity associated with discrete policy changes