Tarullo: Fed will 'watch and see' over medium term after Brexit vote
Comments from Tarullo
- Tarullo says the reaction 'to this point' has been as expected
- Financial system well prepared for Brexit shock
- We'll have to watch how Brexit plays out
- Three will be some impact in the UK, no one knows the scale
On interest rates in the US:
- I don't believe in 'normalization'
- Recent jobs creation shows there was more slack in jobs market than believed
- "This is not an economy that's running hot"
- The neutral rate of interest rates has come down quite a bit
- We have tools to respond pickup in economy; if it were to slow down our tools our limited
- For some time now, I have thought it was the better course to wait and see if inflation rose to 2%
- For some time now, I have not seen evidence of inflation rising to target
- I would want to be more convinced the underlying rate of inflation is 2%
- I'm not convinced that 2% underlying inflation is coming but that data may come
He's speaking with Jon Hilsenrath and Jacob Schlesinger at the WSJ.