Fed Vice Chairman Stanley Fischer on Friday issued a firm defense of the U.S. central bank’s decision not to follow a mathematical rule when deciding monetary policy as Republicans in Congress renew efforts to curb the current consensus-based approach.
“Adherence to a simple policy rule is not the most appropriate means of achieving macroeconomic goals,” Fischer said in prepared remarks to an economics conference at Stanford University in California.
Republican lawmakers in Congress have been pushing to make the Federal Reserve set interest rate policy using a mathematical rule.
Under the proposal, the Fed would commit to moving interest rates up or down according to changes in the jobless rate and inflation. The rule adopted would be made public and any deviation from it would lead to a congressional audit.
The Fed has said such a rule would harm the economy and impinge on the Fed’s independence.
In his remarks