Speaking in Detroit
Fed's Lael Brainard is speaking in Detroit:
- gradual interest-rate increases are likely to be appropriate over the next year or 2
- inflation data encouraging, little sign of breakout
- trading causing uncertainty, growth abroad moderating
- watching yield curve as signal on financial conditions
- vulnerabilities building, leveraged lending rising
- may have to raise rates above the long run fast estimates
- Feds publish longer run neutral rate estimate, now at 2.9% is not relevant for great path
- shorter run neutral rate is the relevant monetary policy benchmark
- shorter run neutral rate likely to rise above long run estimate and next year or 2
- economy is meeting threats inflation and employment goals
- economic growth is strong
