WSJ report on why the Fed could remove monetary policy support sooner than expected
The Federal Reserve's Federal Open Market Committee (FOMC) meeting is this week, June 15 and 16.
The Wall Street Journal have a piece up opining about the Fed goal of maximum employment and why hitting it could come sooner than expected:
- 2.6 million people retired since February 2020, according to estimates from the Dallas Fed.
- Cleveland Fed President Loretta Mester said June 4 on CNBC. "Typically, when people retire, they don't come back into the labor force."
- Treasury Secretary Janet Yellen ... said on June 5 that while employment remains more than 7 million jobs below pre-pandemic levels, increased retirements could mean "we don't need to regain quite that many to get back to full employment."
- While current Fed officials have been less explicit in their public comments, they have signaled a similar openness.
Last week most of the 'Fed focus' was on the inflation data, the other leg of the Fed's twin goals. Most at the Fed are dismissing inflation rising as transitory. Still, core inflation hit a 30 year high in last week's CPI data,so there may be some butt-clenching going on around the FOMC table.
Could be something to else to listen out for from the Fed this week.
Link to WSJ here for more detail (may be gated).
Cleveland Fed President Loretta Mester