2 versions

CosmeticWhat changed in REPORTED IN HOUSEcompared with INTRODUCED IN HOUSE (Sep 16, 2025)

Technical corrections only. The primary change is an update to the bill's short title from "Price Stability Act of 2025" in v1 to "Price Stability Act of 2026" in v2, reflecting its reporting year. Procedural reporting language was also added, but no substantive policy changes were made to the proposed amendment of the Federal Reserve Act.

H.R. 5396119th CongressIntroduced Sep 16, 2025

Price Stability Act of 2026

Reported To HouseFinance and Financial SectorMajor

View bill text

Sponsor: Rep. Hill, J. French [R-AR-2]
Committees: Financial Services Committee (primary)
Last action: Jun 24, 2026

Bottom line

This bill would fundamentally alter the Federal Reserve's statutory mission by requiring it to focus exclusively on maintaining stable prices, thereby removing its explicit responsibility for maximizing employment.

What it actually does

This bill amends Section 2A of the Federal Reserve Act to remove the explicit mandate for the Board of Governors of the Federal Reserve System and the Federal Open Market Committee (FOMC) to focus on 'maximum employment.' If enacted, the Federal Reserve's statutory objectives would be narrowed to solely 'stable prices,' eliminating its dual mandate.

Proponents argue

Supporters argue that a singular focus on price stability would allow the Federal Reserve to more effectively combat inflation, prevent asset bubbles, and ensure long-term economic health by removing a potentially conflicting objective. They contend that the Fed's employment mandate often leads to overly accommodative monetary policy, contributing to inflationary pressures and economic instability.

Opponents contend

Opponents argue that removing the employment mandate would diminish the Federal Reserve's ability to respond to economic downturns and prioritize the well-being of workers. They contend that a dual mandate provides necessary flexibility to address both inflation and unemployment, and that focusing solely on prices could lead to higher unemployment during recessions and exacerbate economic inequality.

The bill is extremely short and direct, making its core policy change immediately apparent to any reader. It requires minimal time to read the text itself.

Section 2

Removal of Maximum Employment Mandate

prominently featuredstraightforward

This section directly amends the Federal Reserve Act (12 U.S.C. 225a) by striking the phrase 'maximum employment,' from the statutory objectives of the Federal Reserve. Currently, the Fed is mandated to pursue 'maximum employment, stable prices, and moderate long-term interest rates.' With this amendment, the mandate would change to 'stable prices, and moderate long-term interest rates,' effectively removing maximum employment as an explicit statutory goal for monetary policy.

GroupImpactMechanismScale

GroupFederal Reserve Board of Governors and Federal Open Market Committee (FOMC)ImpactChanges statutory directive and policy frameworkMechanismDirect amendment to the Federal Reserve Act, altering the legal objectives that guide monetary policy decisions.ScaleFundamental shift in the central bank's core mission.

GroupU.S. Labor Force and WorkersImpactPotential shift in monetary policy priorities away from employment supportMechanismThe Fed's policy decisions would no longer explicitly target maximum employment, potentially leading to less accommodative policies during periods of high unemployment.ScaleBroad economic impact on job creation, wage growth, and unemployment rates.

GroupBusinesses and EmployersImpactPotential impact on labor market conditions, borrowing costs, and economic stabilityMechanismIndirectly through the Federal Reserve's influence on interest rates, economic growth, and the overall business cycle.ScaleBroad economic impact on investment, hiring decisions, and operational costs.

Supporters argue

Supporters argue that a singular focus on price stability is the most effective way for the Federal Reserve to contribute to long-term economic growth and ultimately, sustainable employment. They believe that trying to manage both objectives can lead to policy errors, such as excessive inflation, and that the Fed's tools are better suited for inflation control than for directly managing employment levels.

Critics contend

Opponents contend that removing the employment mandate would make the Federal Reserve less responsive to the needs of the labor market, potentially leading to prolonged periods of high unemployment during economic downturns. They argue that employment is a critical component of economic well-being and that the dual mandate provides necessary flexibility for the Fed to address both inflation and unemployment effectively.

Tradeoffs

This provision highlights the fundamental tension between prioritizing price stability and maximizing employment in monetary policy. It forces a choice between a singular focus on inflation control, which proponents believe leads to greater long-term stability, and a broader approach that also explicitly considers labor market health, which opponents argue is essential for societal well-being.

About this analysis. AI-Generated from the official bill text and available committee reports. Gaps in available data are noted explicitly. Verify important details with the official Congress.gov record.