- Economic momentum has slowed in recent months
- Job creation too slow to reduce unemployment; inflation rate has declined
- Current situation “wholly unsatisfactory” when viewed through the lens of the Fed’s dual price stability and maximum employment mandates
- Fed monitoring foreclosure developments closely to evaluate impact on banks and the economy.
Don’t expect the Dudley comments to have lasting impact. QE is baked into the cake already…
Also on the wires, Chicago Fed’s Evans reiterates his comments from the weekend that the US is in a liquidity trap and that it is entirely appropriate to boost inflation temporarily via large-scale asset purchases to avoid the trap.
