Speaking on Bloomberg Radio:

  • Fed is getting closer to the time to consider normalizing
  • Monetary policy is data dependent
  • ‘Patient’ means no move in next couple meetings
  • We will see inflation in 2015 well below 2%
  • We are getting close to thinking about the pros and cons of raising rates
  • Monetary policy acts with a lag
  • Lift off will be driven by progress on jobs and outlook on inflation
  • Market views on lift off timing are ‘relatively reasonable’
  • We could delay lift off if inflation stays too low

Yellen was clear, and there is an increasing sense the Fed wants to look past low inflation in 2015 to a pickup in 2016 but hiking rates when inflation is flat-lining will prove tough.