Thank you, Dean Logue. It is wonderful to be back in my adopted home state of Michigan and on the University of Michigan's beautiful campus. The fact that you got this Georgia native to visit in the first week of January shows you just how much I love it here. But, seriously, the program committee for the University of Michigan Law School's Seventh Conference on Law and Macroeconomics has put together an impressive program. I am grateful for the opportunity to present my views and to learn from all of you.
Today, I would like to speak about the Federal Reserve Board's work on financial stability. It is a topic that holds special importance to me, because I am the chair of the Board of Governors' Committee on Financial Stability. But before speaking on financial stability, given that it is the beginning of a new year, I thought it would be helpful to share my economic outlook and my views on appropriate monetary policy.
Overall, the U.S. economy starts the year in good shape. Economic growth was quite strong in 2024. Inflation has fallen considerably from its peak two and a half years ago, though it remains somewhat above the Fed's 2 percent objective. The labor market is solid, with the unemployment rate still relatively low and Americans, on average, bringing home paychecks that are growing faster than inflation.
My focus, and that of my colleagues on the Federal Open Market Committee (FOMC), is on our dual-mandate goals of price stability and maximum employment. This year, I will continue to work on calibrating monetary policy to ensure inflation returns sustainably to our 2 percent target while maintaining a solid labor market. I will also carefully monitor financial stability risks and vulnerabilities and work with my colleagues at the Fed and other agencies to reduce the likelihood that financial stability problems will disrupt the economy.