participants'judgments about the measured rates of inflation consistent with the federal reserve's dual mandate and about the time frame over which policy should aim to attain those rates. the rate of inflation that is actually realized will of course depend on a variety of factors. inflation could be lower than we anticipate if slower - than - expected global growth moderates the pressure on the prices of energy and other commodities or if rates of domestic resource utilization fall more than we currently expect. upside risks to the inflation projection are also present, however, including the possibilities that energy and food prices do not flatten out or that the pass - through to core prices from higher commodity prices and from the weaker dollar may be greater than we anticipate. indeed, the further increases in the prices of energy and other commodities in recent weeks, together with the latest data on consumer prices, suggest slightly greater upside risks to the projections of both overall and core inflation than we saw last month. should high rates of overall inflation persist, the possibility also exists that inflation expectations could become less well anchored. any tendency of inflation expectations to become unmoored or for the fed's inflation - fighting credibility to be eroded could greatly complicate the task of sustaining price stability and could reduce the flexibility of the fomc to counter shortfalls in growth in the future. accordingly, in the months ahead, the federal reserve will continue to monitor closely inflation and inflation expectations. let me turn now to the implications of these developments for monetary policy. the fomc has responded aggressively to the weaker outlook for economic activity, having reduced its target for the federal funds rate by 225 basis points since last summer. as the committee noted in its most recent post - meeting statement, the intent of those actions has been to help promote moderate growth over time and to mitigate the risks to economic activity. a critical task for the federal reserve over the course of this year will be to assess whether the stance of monetary policy is properly calibrated to foster our mandated objectives of maximum employment and price stability in an environment of downside risks to growth, stressed financial conditions, and inflation pressures. in particular, the fomc will need to judge whether the policy actions taken thus far are having their intended effects. monetary policy works with a lag. therefore, our policy stance must be determined in light of the medium - term forecast for real activity and inflation as well as the risks to that forecast. although the fomc participants'economic projections envision

banks. section 165 ( d ) of the dodd - frank act requires banking organizations with total consolidated assets of $ 50 billion or more and nonbank financial companies designated by the fsoc to submit resolution plans to the federal reserve and the fdic. each plan must describe the organization ’ s strategy for rapid and orderly resolution in the event of material financial distress or failure. in completing the second round reviews of these banking organizations ’ resolution plans, the fdic and the federal reserve noted certain shortcomings in the resolution plans that the firms must address to improve their resolvability in bankruptcy. both agencies also indicated the expectation that the firms make significant progress in addressing these issues in their 2015 resolution plans. bis central bankers ’ speeches in addition, the federal reserve has been working with the fdic to develop a proposal that would require the u. s. gsibs to maintain a minimum amount of long - term unsecured debt at the parent holding company level. while minimum capital requirements are designed to cover losses up to a certain statistical probability, in the even less likely event that the equity of a financial firm is wiped out, successful resolution without taxpayer assistance would be most effectively accomplished if a firm has sufficient long - term unsecured debt to absorb additional losses and to recapitalize the business transferred to a bridge operating company. the presence of a substantial tranche of long - term unsecured debt that is subject to bail - in during a resolution and is structurally subordinated to the firm ’ s other creditors should reduce run risk by clarifying the position of those other creditors in an orderly liquidation process. a requirement for long - term debt also should have the benefit of improving market discipline, since the holders of that debt would know they faced the prospect of loss should the firm enter resolution. the federal reserve is working with global regulators, under the auspices of the fsb, to develop a proposal that would require the largest, most complex global banking firms to maintain a minimum amount of loss absorbency capacity beyond the levels mandated in the basel iii capital requirements. another element of our efforts to promote resolvability of large banking organizations involves the early termination rights of derivative counterparties to gsibs. some of the material operating subsidiaries of gsibs are counterparties to large volumes of over - thecounter derivatives and other qualifying financial contracts that provide for an event of default based solely on the insolvency or receivership of the parent holding company. although the dodd -