We’re into the Q&A
- Sentiment seems to be positive and GDP decline looks largely due to transitory factors
- We have seen false dawns in the past so we are watching carefully, especially given rates are so low
- We have to make sure economy is on a solid path before hiking
- We want to make sure the financial system can withstand any bursting of bubbles
- Will look for progress towards job and inflation goals before thinking about first rate hike
Not giving anything away on rates at all.
- Fed is discussing exit strategy but no decisions on precise exit have been made
- Big Fed balance sheet poses a challenge
- Reverse repo is a back up tool to help control funds rate and tests show it to be a very useful and effective tool
- Fed does have concerns that repo tool would become too big
