Navigating toward normal: the future for policy

The Federal Reserve is on track to end asset purchases in the near future and has laid the groundwork for its plan to eventually normalize monetary policy by raising short-term interest rates. The process of policy normalization is unlikely to start soon, however, and its exact timing will depend on further improvements in unemployment, wages, and inflation. This Economic Letter is adapted from a presentation by the president and CEO of the Federal Reserve Bank of San Francisco to business and community leaders in Las Vegas, Nevada, on October 9, 2014.