Recent comments from Fed officials on the US monetary policy outlook

FXStreet Team FXStreet

Federal Reserve Chairman Jerome Powell said at the economic club of New York on Wednesday, November 28 that:

Powell: "close" to price stability, maximum employment mandates
Gradual US rate hikes balance risks to forecast
FED is balancing risks of shortening expansion, on one hand, higher inflation and instability on other
Powell repeated that he sees "moderate" overall vulnerabilities to financial stability
Powell expects solid US growth, low unemployment, and near-target inflation
Powell reiterated that there is no pre-set policy path as Fed is paying "very close attention" to data
FED working with U.S. firms to prepare for a full range of Brexit outcomes

Federal Reserve Governor Richard Clarida expressed a cautious policy outlook while speaking to bankers in New York on Tuesday, November 27. The Federal Open Market Committee's newest member emphasized the importance of policymakers’ data dependency in their approach. Key points from Clarida’s speech:

Uncertainty around neutral policy, maximum unemployment highlights need for data-dependency
Monetary policy should aim to sustain US growth and to achieve its dual mandate
Risks are now more symmetric, less skewed to the downside than in past
Clarida expects inflation to remain anchored; watching for signs of weakness
Clarida would back more rate hikes than expected if inflation surprised to the upside
The US economic fundamentals “robust” and GDP growth “strong“
US labor market “robust” and wage growth picking up

St. Louis Federal Reserve President James Bullard said on Tuesday, November 27 that:

Possible “cracks” in growth to shape FED debate in the coming year
Bullard further said expects slower growth over the next two years, making it 'tougher' for FED to continue rate increases
Bullard, the upcoming voter on policy in 2019, said rates already at or near the neutral level
Bullard said the economy, jobs market otherwise strong, with only moderate financial risks
Bullard said he does not expects low unemployment to spark inflation

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