Patrick Harker, Speech: Understanding Monetary Policy Through the Housing Channel

Banking Crisis

“It will take some time to evaluate how recent events may impact overall economic activity and inflation. I expect to see tighter credit conditions for households and businesses that may slow economic activity and hiring, but the full extent is still unclear.”

Fed Funds

“I anticipate that some additional tightening may be needed to ensure policy is restrictive enough to support both pillars of our dual mandate. Once we reach that point, which should happen this year, I expect that we will hold rates in place and let monetary policy do its work.”

GDP

“I project that we will see modest growth this year, with real GDP coming in a bit below 1 percent.

Inflation

“I expect inflation to continue declining, landing somewhere between 3 percent and 3.5 percent this year, before falling to 2.5 percent in 2024, and leveling out at our 2 percent target in 2025.”

Jobs

“Unemployment is also likely to tick up slightly, hitting around 4.4 percent this year.”