Powell Q&A: We want to see actual 'substantial progress' not just forecasts before taper talk

Author: Adam Button | Category: Central Banks

Powell in the Q&A:

Powell in the Q&A:
  • We want to see actual 'substantial progress' not forecasts for that
  • Says 'not yet' when asked about if it's time to talk about tapering
  • We will want to talk about progress well in advance of a taper
  • We want to see actual data, not just forecasts
  • We expect that to happen but we'll have to see it first
  • We'll have something to announce on SLR 'in coming days'
  • The SEP is not a committee forecast, it's a compilation
  • The state of the economy in 2-3 years is highly uncertain, I wouldn't want to focus on a forecast that far out
  • It will take time for people to adjust to us waiting for actual data but the only way to create credibility on that is to do it
  • I would be concerned by disorderly conditions in markets or a persistent move that threatened our goals
  • We're committed to accommodative stance until the job is well-and-truly done
  • The stance of monetary policy we have today we believe is appropriate, with think our QE purchases are appropriate
  • The fiscal response will look good in the long term
  • There are different perspectives on the FOMC because we've never been in a pandemic before; we've never had this kind of fiscal support before
  • For liftoff, the Fed needs maximum employment and inflation at 2% but not on a transient basis
  • It's absolutely essential to maintain financial stability and carefully monitor it
  • Over the long expansion before the pandemic, we didn't see an excess build up
  • The connection between low rates and financial instability is not as tight as people think
  • Notes that progress in jobs market slowed Nov-Jan
  • We saw a nice pickup in Feb jobs but it can go so much higher, I think it will be
The US dollar is continuing to fall as Powell emphasizes waiting to see realized progress on 'substantial progress' and saying they will brush off temporary inflation.

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