Dual Mandate
The Fed’s dual mandate is maximum employment and stable prices — two goals that agree in a demand shock and fight in a supply shock.
Definition
Dual Mandate refers to two goals that agree in a demand shock and fight in a supply shock. Keep that definition fixed when comparing series, managers, or regimes — renaming the same tape does not create a new signal.
Why it matters
Policy reaction functions move discount rates and liquidity; this concept is one of the levers or constraints. When two goals that agree in a demand shock and fight in a supply shock shifts, related hedges, limits, and narratives usually need an explicit update rather than a quiet assumption.
Case
Suppose a desk is positioned for the opposite of what dual mandate is saying. If two goals that agree in a demand shock and fight in a supply shock moves against that book, the first question is not “is the story clever?” but whether size, hedges, and stop logic still match the observation.
How to read it
Map the calendar, communication regime, and balance-sheet tools — words and paths both matter. Prefer a short written null hypothesis for Dual Mandate: what would falsify the current reading in the next window?