Fed's Evans (NY speech): Concerned about downside misses on inflation

Author: Greg Michalowski | Category: Central Banks

Chicago Fed President speaks in New York

  • Concerned about downside misses on inflation
  • Policy has been successful in achieving maximum employment, less so on inflation
  • Fed must be willing to embrace inflation up modestly above 2% half the time
  • He would communicate comfort with 2.5% core inflation if there is not upward momentum and path back to 2% can be managed
  • Fundamentals for growth in US remain good
  •  Economy faces many uncertainties and risks about growth abroad, trade policy
  •  At the moment risks from downside scenarios loom larger than those from the upside
  •  Prudent approach to policy makes sense given heightened uncertainty
  •  Fed is currently reviewing maturity structure of balance sheet, better ways to achieve inflation target
  • His economic forecast is consistent with median FOMC projections last month
  • Inflation rise to 2.25% to 2.5% is not a big concern to me at the moment
  • If activity softens more than expected or inflation too low, policy may be left on hold or loosened
  • He is open-minded on right duration for feds asset portfolio
Evans is thought to be more of a dove. He is the  president of the Chicago Fed and he is a voting member on the FOMC this year.
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