US Federal Reserve vice-chair Stanley Fischer in prepared remarks for a banking seminar in Washington 9 Oct
- Sept rate hold didn't reflect lack of confidence in economy
- Fed chose to wait for more signs of progress on goals
Just caught these headlines as I was heading away. Hot off the press! Bloomberg reporting.
- sees little risk of falling behind the curve
- changes in economy and risks to guide Fed's rate path view
- recent labour market reports have been solid
- rise in labour participation a welcome development
- US close to full employment, sees more improvement
- sees business investment improving in H2
- weak non-energy investment bears close watching
- foreign economies growing at a moderate pace
- sees US inflation moving to 2% as oil and USD stabilize
"With the federal funds rate modestly below the neutral rate, the current stance of monetary policy should be viewed as modestly accommodative, which is appropriate to foster further progress toward our objectives"
"But since monetary policy is only modestly accommodative, there appears little risk of falling behind the curve in the near future, and gradual increases in the federal funds rate will likely be sufficient to get monetary policy to a neutral stance over the next few years"
We all know that the Fed are in between a rock and a very hard place and Fischer's comments confirm their concerns and frustration.
Other recent comments from Fischer we posted here and here
Fischer pointing the way on December interest rate decision?
