Comments from Brainard:
- Context matters in assessing progress on inflation
- We have looked at asset valuations recently and we are seeing some signs of stretched valuations but they're not broad at this juncture
- Burst of transitory bubble seems more probable than durable shift above inflation target
- There is a lot of slack in the unemployment rate when you add in 4m discouraged workers and people dropping out, it's 10%
- Market developments last week caught my eye
- I would be concerned if I saw disorderly conditions or persistent rises in yields that threaten our goals
- I watch these bond market developments 'very carefully'
This is nowhere near the kind of response that we saw from the RBA or ECB but she highlights the risks around higher yields here. It's not even verbal intervention but it's something. Still, it's the weakest thing she could have possibly said.
Treasury yields have ticked fractionally higher on this.
"I am paying close attention to market developments -- some of those moves last week and the speed of those moves caught my eye"