Fed's Kaplan: 10-year yield is a natural constraint on how high Fed can raise rates
|Dallas Fed President Kaplan continues to give his remarks in El Paso, Texas, with key quotes (via Reuters) found below:
- Can afford to be patient in removing accommodation
- Decline in 10-year yield is primarily due to lower expectations for U.S. growth
- 10-year yield is a natural constraint on how high the Fed can raise rates
- Fed should be open to new ideas about governance, as long as retain political independence
- Must be very careful not to have a tax cut that is funded by increasing the deficit
- Must be very careful not to have a tax cut that is funded by increasing the deficit
- A deficit-funded tax cut would create headwind for future economic growth
- Would like to see a discussion of immigration reform, thoughtful infrastructure investment
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