Chicago Fed president Evans speaking

Chicago Fed president Evans speaking_

Chicago Fed president Charles Evans (voting member in 2021) is speaking at BKD financial services symposium.

He says:

  • Expects a good market momentum for US economy well into 2022
  • Optimistic about 2022
  • labor market will continue to improve next year as more people come back into the labor force
  • Expects unemployment to go below 4% maybe like 3.5% next year
  • We are looking at some pretty substantial increases in labor costs
  • Supply chain issues will last longer into 2022 then would like but am optimistic
  • There's a long way to go before we get to price inflation getting embedded through expectations
  • We positioned ourselves quite well
  • By mid-2022 can assess the employment situation, fiscal situation, inflationary pressures and how much we should adjust stance of monetary policy
  • Rate hikes could begin next year
  • Rate hikes could also begin in 2023 depending on inflation
  • We may have to lean into slightly more restrictive policy than was expected six months ago
  • Policy adjustments can be relatively gradual
  • Expect will be making adjustments to monetary policy in 2022 and 2023
  • September Fed economic projections are a little stale
  • Am more open-minded to adjustments in monetary policy in 2022
  • I don't worry about two vibrant the labor market, but must measure it against if inflation is running too hot

Evan's comments are a notch up toward more hawkish