American Institute For Economic Research·2026-04-29·via All Articles on Seeking Alpha
Summary
The Federal Open Market Committee is widely expected to leave its policy rate unchanged at this week’s meeting.
The rise in energy prices tied to the conflict with Iran is the sort of negative supply shock that makes monetary policy especially difficult.
The latest Monetary Rules Report from AIER’s Sound Money Project shows that the Fed’s current policy rate already sits near the lower end of the recommended range.
Rules based on nominal gross domestic product, or NGDP, suggest somewhat lower rates, with an NGDP level rule at 3.93 percent and an NGDP growth rule at 3.53 percent.
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By Matthew Schaffer
Energy-driven inflation and slowing growth have put the Fed in a difficult position. A look at monetary policy rules shows why holding rates steady may be the most prudent response.
