Federal Reserve Vice Chair for Supervision Michael Barr

  • January data was stronger than expected for both jobs and inflation.
  • Fed is looking at "totality" of the numbers.
  • Lack of historical parallels makes current monetary policy decisions "difficult."
  • Data suggest Fed is on a "good path," but still early to say there will be a soft landing.

Putting these two together:

  • January data was stronger than expected for both jobs and inflation.
  • Fed is looking at "totality" of the numbers.

Doesn't sound too dovish to me. If inflation and jobs are up that'd be tighter for longer, at the margin, if I had a chair at the FOMC table.

More:

  • Still an imbalance between housing supply and demand.
  • High interest rates are dampening both sales and purchases of existing homes.
  • BTFP was successful in ensuring bank liquidity at a moment of stress.
  • Not seeing liquidity pressures in the banking system today.
  • CRE pressures seen today are more "old fashioned" risk banks typically face.
  • CRE pressures are acute in offices in certain business districts.
  • There will be price compression and losses on CRE, but don't expect acute pressure on banks.