Federal Open Market Committee announces updates that further enhance its policy on investment and trading

January 31, 2024 / Source: FRB

The Federal Open Market Committee on Wednesday announced updates that further enhance its policy on investment and trading. The policy, which was first adopted in 2022, aims to support public confidence in the impartiality and integrity of the Committee’s work by guarding against even the appearance of any conflict of interest.

The updates will increase the number of Federal Reserve System staff who will be covered by the most stringent restrictions on investment and trading activities and will tighten restrictions on all staff with access to confidential FOMC information. Additionally, the updated policy supports a new compliance regime where staff with access to the most sensitive FOMC information may be directed to submit brokerage statements or other securities transaction statements to verify the accuracy of their financial disclosures.

The existing policy already prohibits senior Federal Reserve officials involved in monetary policy decision-making from purchasing individual stocks or sector funds; holding investments in individual bonds, agency securities, cryptocurrencies, commodities, or foreign currencies; entering into derivatives contracts; and engaging in short sales or purchasing securities on margin. The policy also requires those officials to provide 45-days’ non-retractable notice for securities transactions and receive prior approval.

The new restrictions in the policy are effective on June 30, 2024.

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