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FOMC SPEECH THIS WEEK: 10-14 May, 2021

 

FED CHICAGO

Fed’s Evans says employment and inflation need to pick up before policy changes

Chicago Federal Reserve President Charles Evans told CNBC on Monday that employment and inflation will have to pick up substantially before he will change his position on monetary policy.

 

- Fed officials would like to see higher inflation, more wage growth and several months of strong employment gains before they consider adjusting monetary policy, Chicago Fed Bank President Charles Evans said on Monday.

 

- Fed's Evans: April's slow job creation likely a "one month thing" - CNBC

 

- Chicago Fed President Charles Evans: Many price increases are reversals of pandemic declines

Chicago Fed President Charles Evans joined “Squawk Box” on Monday to discuss how temporary he thinks inflation may last and how fears may impact Fed policy decisions.

FED CLEVELAND

The Fed has repeatedly maintained that any inflation would be transitory in nature. On Tuesday, Cleveland Federal Reserve Bank President Loretta Mester said she expected inflation to end the year above 2% but to come down next year as supply constraints ebb.

 

FED PHILADEPHIA

·         Fed's Harker sees no reason to withdraw monetary policy support yet

Philadelphia Fed President Patrick Harker said there are sill factors slowing down the recovery in the labor market, and believes the central bank should continue to provide support to the economy.

Fed's Harker says 3% inflation is the maximum he would like to see

 

FED GOVERNOR

·         Brainard: Pulling back support due to high stocks may hurt efforts to boost jobs

Any move by the U.S. Federal Reserve to limit its support for the economy because of surging asset prices would damage the conditions the central bank is helping create to spur job growth and the help millions still unemployed due to the pandemic find work, Fed Governor Lael Brainard said on Tuesday.

 

FED ATLANTA

·         Fed’s Bostic Says Economic Inclusion is Key Mission for the Fed

Creating a more inclusive economy that provides better jobs for low income workers and minorities is part of the U.S. central bank’s key mission of pursuing maximum employment, Federal Reserve Bank of Atlanta President Raphael Bostic said.

“Economic inclusion, I firmly believe, is among the defining economic issues of our time,” Bostic said Thursday in prepared remarks to the Consumer Financial Protection Bureau’s research conference. “We have a chance to make fundamental change and progress, but progress will be hard won.”

 

Fed's Bostic: It's appropriate for Fed policy to stay accommodative

 

FED ST.LOUIS

 

·         Fed’s Bullard says ‘it’s too early to talk taper’ while the pandemic continues

St. Louis Federal Reserve President James Bullard acknowledged the progress the economy has made but said Tuesday it’s still not time to ease back the throttle on policy.

 

FED SAN FRANCISCO

·         Fed's Daly says we are in 'transition,' no taper talk yet

San Francisco Federal Reserve Bank President Mary Daly on Monday said she remains encouraged about the economic trajectory despite a report Friday showing fewer-than-expected job gains last month, adding the economy is a state of “transition” and still needs plenty of monetary policy support.

“We are a long way from normalization,” Daly told Yahoo Finance. Asked if the Fed should start thinking about reducing its $120 billion a month in bond purchases, she said, “not yet.”

 

Fed warns about potential for ‘significant declines’ in asset prices as valuations climb

 

Rising asset prices in the stock market and elsewhere are posing increasing threats to the financial system, the Federal Reserve warned in a report Thursday.

In its semiannual Financial Stability Report, the central bank said that while the system overall has remained largely stable even through the Covid-19 pandemic, future dangers are rising, in particular should the aggressive run on stocks tail off.

Fed Chairman Jerome Powell and others have been asked repeatedly about whether they’re concerned over the rising prices. Powell specifically has said that as long as interest rates stay low, the valuations are justified.

However, the report notes that there’s danger lurking should market sentiment change.

 

 

The Fed plans to keep borrowing costs near 0% and maintain monthly asset purchases worth $120 billion until it sees “substantial further progress” towards full employment and its 2% flexible inflation target.

·         So far, Federal Reserve Chair Jerome Powell has argued the labour market is still far short of where it needs to be to start discussing tapering asset buying.

FED VICE CHAIRMAN:

·         Clarida says the Fed is ‘a long way from our goals’ and tightening policy

Federal Reserve Vice Chairman Richard Clarida told CNBC on Wednesday that he thinks the central bank should keep its ultra-loose policy in place even as the U.S. economy storms back from its pandemic-era tumble.

In a “Closing Bell” interview, Clarida said he expects the economy to grow close to 7% for the full year, which would be the fastest pace since 1984.

He added that the jobs picture continues to improve, but still needs to progress considerably before the Fed will feel comfortable pulling back on all of the help it has provided since Covid-19 ended the longest expansion in U.S. history.

“We’re still a long way from our goals, and in our new framework, we want to see actual progress and not just forecast progress,” Clarida said.

Fed's Clarida says not time to talk taper, doesn't see economy overheating

FED NEW YORK:

·         NY Fed's Williams says brighter outlook not enough to affect monetary policy

FED BOSTIC