Fed’s Rosengren: If risks to the US economy materialize, the Fed should cut aggressively
|Federal Reserve Bank of Boston President Eric Rosengren crossed the wires at the start of Wednesday’s Asian session. Some of his comments are directly related to the Fed’s future moves and the US economic condition.
Key quotes:
“US economic conditions 'relatively benign'.”
“US inverted yield curve reflects challenging economic conditions abroad.”
“Trade disruption, global economic weakness pose risks to US economy.”
“Elevated risks to US economy have not become reality.”
“Sees continued 2% US GDP growth if consumer continues to spend, global conditions don't worsen.”
“If risks to US economy materialize, fed should cut rates aggressively.”
“It's a good time to watch incoming data carefully to see if policy adjustments are needed.”
"Do not want to use up valuable policy space at this time."
"If treasury's goals are same as Fed's, it would be less likely to issue long-term bonds."
FX implications
Market reaction to the news is relatively quiet as all eyes stick to the United Kingdom’s (UK) Brexit showdown. However, such statements from the Fed policymakers generally trigger the US Dollar (USD) volatility.
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