- Tapering ‘more or less’ in line with Bernanke timeline, depends on data
That’s nice but it’s all about politics right now. If Congress continues to take a baseball bat to the knees of the US economy, there is no taper coming. If they cut back on the sequester and provide some long-term certainty, the taper could still be completed by June.
It also depends on the next FOMC Chairman. Tomorrow is the day most people thought the White House would nominate Yellen but it’s gone awfully quiet on the front. Perhaps (understandably) Obama doesn’t want to take the focus of the budget/debt ceiling.
Other headlines from Williams as he spoke to reporters after his speech:
- Concerned that investor and consumer confidence will fall following budget/debt ceiling fight
- Unemployment rate declining ‘pretty nicely’
- Immediate shutdown impact is ‘modest’
- Two week shutdown would cut Q4 GDP (annualized) by 0.25pp
