Nominal GDP (NGDP) targeting has received a lot of attention over the past decade. This note provides a brief review of the key arguments for NGDP targeting and then presents some practical ways to use it in the conduct of U.S. monetary policy. Specifically, this note shows how to construct...

In an October 1995 FOMC meeting, several participants inquired about the potential value and meaning of the spread between the Treasury bill rate and nominal GDP for monetary policy. The idea comes from Salomon Brothers, who think that it is an indicator of policy, in the sense that a high...