Written by: Sophie May
The FOMC is the Federal Open Market Committee. It is the branch of the US’ Federal Reserve Board that takes responsibility for determining the direction of monetary policy. It meets eight times a year to set key interest rates and decide whether to increase or decrease the money supply.
Beige Book
This is released two weeks before each of the eight annual FOMC meetings. The Federal Reserve Banks all collect anecdotal information about the current economic conditions in their areas. They take reports from bank and branch directors as well as interviews with key businessmen, economists, and market experts. The Beige Book then summarizes this gathered information according to district and sector.
Green Book
This book is prepared by staff members at the Board of Governors five days ahead of every FOMC meeting. The first section interprets the most significant, recently-occurring developments in U.S. economic activity and the international sector, including prices, interest rates, flows of money and credit. It also forecasts several variables for the next two years. The second section offers further information on developments, including trends in employment, production, prices, and the factors influencing them. It also features an analysis of various economic sectors and it comments on areas including housing, vehicle production, inventories, and government spending. International developments are discussed, with commentary on trade statistics, international financial transactions, and also the foreign exchange markets.
Blue Book
The Blue Book covers the monetary and financial developments for the few months surrounding the FOMC meeting in question. It reviews the recent developments in policy variables, such as the Federal Funds rate, reserve measures, and monetary aggregates. It also suggests a number of alternative policy scenarios which may arise in the upcoming inter-meeting period.