Comments on “monetary policy and communications” from Cleveland Federal Reserve President Loretta Mester:
- More progress needed on jobs, expects to see it
- ‘Considerable time’ focuses on calendar, not data (she’s said this before)
- Wants to tie Fed guidance to economic projections
- ‘Important not to react’ to weak August payrolls
- Would prefer to reformulate FOMC forward guidance
- Live feed here
- She will host a Q&A afterwards
Markets are keeping a close eye on Mester because she’s new and we don’t have a sense of which side of the hawk/dove spectrum she sits on. She came from the Philly Fed, led by uber-hawk Plosser.
Mester dyed her hair to match the backdrop — nice touch. Or maybe an ode to the rust in Cleveland?
- Sees 2.5% GDP for long-run growth
- Notes her forecast of longer-run growth is higher than Fed median
- Projecting a faster return to full employment than some of her colleagues
She sounds a touch hawkish.
Update 2: Nothing notable in the audience Q&A.