[Federal Reserve's Waller Proposes Two Key Considerations for Monetary Policy: Initial Conditions and Forward Guidance] Odaily Planet Daily News – Federal Reserve's Waller has proposed two key considerations regarding the transmission mechanism of monetary policy, emphasizing that the effectiveness of policy depends on the use of initial conditions and forward guidance: The first point is that 'initial conditions are critical.' Monetary policy assessments should be based on the current state of the economy rather than historical averages. The second point concerns the role of 'forward guidance.' He believes that forward guidance can, in certain circumstances, accelerate policy transmission by influencing market expectations and preemptively altering financial conditions. However, if it is overly rigid or lacks flexibility, it may instead weaken policy effectiveness or even delay necessary policy adjustments. Waller emphasized that in the presence of multiple economic scenarios, it is not appropriate to simply adopt an 'average path' as the basis for policy guidance. Policymaking must maintain adaptability and flexibility to address different scenarios.