In the near term, risk to inflation are tilted to the upside. and risks through employment to the downside. a challenging situation. There is no risk-free path for policy as we navigate this tension between our employment and inflation goals. Our framework calls for us to take a balanced approach in promoting. both sides of our dome mandate. With downside risks to employment having increased in recent months, the balance of risks has shifted. Accordingly, we judged it appropriate at this meeting to take another step toward a more neutral policy stance. With today's decision, we remain well positioned to respond in a timely way. to potentially economic developments. will continue to determine the appropriate stance of monetary policy. Based on the incoming data, the evolving outlook. in the balance of risks. We continue to face two sided risks. in the committee's discussions at this meeting. There were strongly differing views about how to proceed in December. before the reduction in the policy rate at the December meeting. is not a foregone conclusion. from it. policy is not on a preset course. And today's meeting, the committee also decided to conclude the reduction of our aggregate securities holdings as of December 1. Our long-stated plan has been to stop balance sheet runoff when reserves are somewhat above the level we judge consistent with ample reserve conditions. signs have clearly emerged that we have reached that standard. In money markets, repo rates have moved up relative to our administered rates, and we have seen more notable pressures on selected dates, along with more use of our standing repo facility. In addition, the effective federal funds rate. has begun to move up relative to the rate of interest on reserve balances. These developments are what we expected to see. at the size of our balance sheet declined. and warrant today's decision to seize runoff. Over the 3.5 years that we've been shrinking our balance sheet. Our securities holdings have declined by $2.2 trillion. as a share of nominal GDP. Our balance sheet has fallen from 35% to about 21%. In December, we'll enter the next phase of our normalization plans by holding the size of our balance sheet steady for a time. While reserve balances continue to move gradually lower, as other non-reserved liabilities such as currency.

keep growing. We will continue to allow agency securities to run off our balance sheet and will reinvest the proceeds from those securities. in treasurery bills. furthering progress toward a portfolio consisting primarily at Treasury Securities. This reinvestment strategy will also help move the weighted average maturity of our portfolio. closer to that of the outstanding stock of treasure securities. thus furthering the normalization of the composition. of our balance sheet. The Fed has been assigned. goals for monetary policy. maximum employment and stable prices. We remain committed. to supporting Max Arp. maximum employment, bringing your inflation to standably to our 2% goal. and keeping longer term inflation expectations well-angred. our success in delivering on these goals matters to all Americans. We understand that our actions affect communities, families, and businesses across the country. Everything we do is insurers to our public mission. We at the Fed will do everything we can to achieve our maximum employment and price stability goals. Thank you. I look forward to your questions.