Comments from the Chair in the Q&A
- Seeing 'definite' evidence the economy picking up
Like what? The data has been sliding.
- Economy has a little more room to run than might have been previously thought
She's saying the Fed has more time to wait-and-see before it has to worry about inflation
- Most agreed that the case for a hike was stronger
- Mostly agreed we would like to see additional progress before hiking
- We're going to watch for additional evidence
- Most anticipate one hike will be appropriate this year
- If we continue on the course for jobs without any shocks, I expect a hike this year
- Our assessment of monetary policy is somewhat accommodative
The bolded is hawkish. She said that not much needs to happen to justify a hike. No shocks and jobs growth around 150K. That's a low bar.
- There is less Fed disagreement than you might think
- We're struggling with difficult issues like what the new normal is
- Important to have independent-minded people and different views
- The FOMC does not suffer from groupthink
"Our organization suffers from groupthink" - said no head of an organization ever.
- "Partisan politics plays no role in our decisions about the appropriate stance of monetary policy."
- Every meeting is live, including November
I'll believe that if they hike Nov 2.
- Commercial real estate prices have caught our eye
- Asset values not out of line with historical norms
- The Fed doesn't want to cause downside risks for jobs market
- There are also risks that inflation doesn't get back to 2%
- There are risks of waiting too long to hike
- It's tough to judge which is the more-serious risk, we're all struggling with it
- I can't recall any meeting where politics has been discussed
