More from Fed's Bostic: Fed is going to be more comfortable with a bit more volatility in inflation

Author: Greg Michalowski | Category: Central Banks

More from Feds Bostic

Atlanta Fed president Bostic
  • Fed is going to be more comfortable with a bit more volatility in inflation
  • He still has a lower for longer approach in his head
  • He is not seeing signs at current inflation is doing the kind of harm to the economy that would call Fed's policy stance into question
  • It is important for the public to understand Fed officials are not in lockstep and have different views
  • Markets are functioning fine now. He is not expecting an adverse impact from tapering, nor does he see a taper adversely affecting the speed of the economy
  • The more important factor will be the trajectory of the virus and the countries pandemic response
  • Speed of labor market recovery will be very much tied to labor force participation
  • The pandemic is causing everyone to take a step back to evaluate what their attachment should be to the labor market
  • His hope was that September would provide more clarity on the economy and labor market economic challenges are really on the supply-side not demand-side
  • Credit quality of borrowers buying homes is higher than before and there is not the same concentration of high risk loans as in the last crisis
  • There are challenges and affordability of housing for first-time buyers
  • His hope is at home prices may return to a more normal trajectory as supply and demand imbalances even out
  • Keeping rates lower for longer can help some workers get more engaged in labor market and see the benefits of the recovery

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