This story is making the rounds and I have no clue what to make of it.
Via the WSJ:
Four Board Members Discussed “Medium-Term Monetary Policy Issues”; Details Undisclosed
WASHINGTON—The Federal Reserve Board of Governors held an uncommon closed-door meeting Tuesday to discuss monetary policy.
The four board members met to discuss “medium-term monetary policy issues,” according to a notice posted on the Fed’s website. No further details were provided. Government sunshine laws allow the Fed to keep meetings on monetary policy matters private.
The meeting started at 10:30 a.m. Tuesday, according to the notice, which was the same time the larger Fed’s policy-making Federal Open Market Committee convened its two-day meeting. A Fed spokesman declined to say if the two meetings were combined, or how long the board meeting lasted.
He also declined to say whether any details about the closed meeting would be disclosed when the full policy committee releases its statement Wednesday at 2 p.m. ET. The Fed is expected to vote to cut its monthly bond purchases by another $10 billion to $45 billion and hold short-term interest rates steady near zero.
The last time the Fed board met to discuss “medium-term monetary policy issues” was in 2011, when the board met five separate times from April through December to deliberate over medium-term matters, according to BNP Paribas BNP.FR -3.20% economist Laura Rosner.
Two of those meetings happened in April and June, 2011. The second occurred June 21-22, the same dates as a two-day Fed policy meeting, at which officials agreed to an official strategy for exiting their easy money policies.
“If Fed governors have rekindled similar discussions, this could mean the committee is reviewing its June 2011 exit principles and [is] close to releasing an updated version,” Ms. Rosner wrote in a note to clients.
Under that exit plan, the Fed would one day sell its holdings of mortgage-backed securities over a period of three to five years. Former Fed Chairman Ben Bernanke raised the prospect last year the Fed might never sell those mortgage bonds, but rather would let them mature over time. He said at a June news conference that a “strong majority” of Fed officials expected they wouldn’t sell the mortgage bonds. But no formal changes have been made to the June 2011 plan.
The Fed has purchased around $3 trillion in mortgage-backed and Treasury securities since the 2008 financial crisis to help stabilize the financial system and boost growth by lowering long-term interest rates.
Corrections & AmplificationsThe last time the Federal Reserve Board of Governors held a similar meeting was Dec. 12, 2011. An earlier version of this story cited BNP Paribas analysts saying the last time the board held a similar meeting was April 26, 2011.