Money and Financial Markets
The March 20 reduction of the federal funds rate target (from 5.50% to 5.00%) has not quelled discussion on the appropriateness of monetary policy. Debate about interest rates, however, tends to ignore a crucial aspect of the question—the money supply. Monetary aggregates have continued to grow at substantial rates and might lead to the suggestion that monetary policy has, if anything, become too loose.
Suggested citation: "Money and Financial Markets," Federal Reserve Bank of Cleveland, Economic Trends, no. 01-04, pp. 05-07, 04.01.2001.