- Unemployment 2-2.5 points above Fed view of the long-run sustainable level
- Ongoing economic slack should restrain wage and price increases
- Inflation over next few years likely to remain close to, or a bit below, 2% objective
- Too early to assess full effects of QE3
- Fiscal cliff poses substantial threat to recovery, could send US back into recession
- Failure to lift debt ceiling could cause harm
- Fiscal uncertainty may already be causing financial market caution
No mention of what will happen when Operation Twist expires but he may address that in the questions. Most market participants expect fresh Treasury buying to replace the program, which expires at the end of the year.
