Speeches, Interviews, Essays

“Even as the pandemic continues to influence economic activity, the time has come to transition monetary policy away from its current crisis stance towards a more normal posture in the interest of long-run stability. With robust demand, high inflation, and a tight labor market, policymakers will need to grapple with the appropriate speed and magnitude…

Only general economic information was covered. “As always, challenges remain. Both the initial shutdown and the subsequent reopening of the economy were without precedent. The economy has rapidly gained strength despite the ongoing pandemic, giving rise to persistent supply and demand imbalances and bottlenecks, and thus to elevated inflation. We know that high inflation exacts…

“At the December FOMC meeting, participants suggested that it will be important that we monitor money market conditions as reserves fall in order to assess the appropriate level of reserves to maintain ample conditions. Indeed, we do have a lot of money market data, which allows us to observe those conditions in money markets at…

“The U.S. pandemic recession ended 20 months ago. U.S. real gross domestic product (GDP) has more than fully recovered, and labor market performance continues to improve.” “The FOMC could begin increasing the policy rate as early as the March meeting in order to be in a better position to control inflation.” “Subsequent rate increases during…

“That speaks to the importance of effective and creative communication; no matter how well intentioned or designed a relief program may be, it is bound to fail if many who are eligible for it are simply unaware of its existence. Another possibility going forward would be to design more programs so they could take effect…

“In summary, while my baseline forecast remains that the high inflation consumers and businesses are currently experiencing will likely be transitory, I am putting more weight on the possibility that such transitory high inflation could nonetheless lead to an increase in long-term inflation expectations above our 2 percent target. Hence, I now believe the FOMC…

“Well, the federal funds rate is our primary policy tool, moving it up and down. And, the question was, once we got down to zero, is the Fed out of ammunition? And we learned in the ’08 crisis, no, the Fed could use its balance sheet through quantitative easing to try to drive down long-term…

“Based on my outlook for the economy, however, I do not expect liftoff to occur soon after tapering is completed. The two policy actions are distinct. I believe the pace of continued improvement in the labor market will be gradual, and I expect inflation will moderate, which means liftoff is still some time off.” “That…

“At its July meeting, the FOMC established two standing repo facilities as tools in the Fed’s policy implementation framework: a domestic standing repo facility (SRF) and a repo facility for foreign and international monetary authorities (FIMA Repo Facility).  These facilities will serve as backstops in money markets to support the effective implementation of monetary policy…

“Although macroeconomic forecasting is fraught with hazards, I would not interpret the currently very flat yield curve as indicating a significant economic slowdown to come, for several reasons. First, in previous episodes when an inverted yield curve was followed by recession, the level of interest rates was quite high, consistent with considerable financial restraint. This…