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Overview: Mon, February 26

Daily Agenda

Time Indicator/Event Comment
08:00Bullard (FOMC non-voter)On US economy and monetary policy 
08:30Chicago Fed NAISlightly below trend in January
10:00New home salesPartial reversal of December decline
10:30Dallas Fed manufacturing surveySlight pullback in headline index this month
11:004-week bill announcementLikely unchanged at $55 billion
11:303- and 6-month bill auctionSteady at $52 billion and $45 billion respectively
15:15Quarles (FOMC voter)

At NABE policy conference 

US Economy

  • Economic Indicator Preview for Monday, February 26, 2018

    The Chicago Fed’s national tracking index may have dipped a bit below the long-run average of zero in January thanks to shortfalls in retail sales and industrial production.  New home sales seem likely to rebound somewhat in January.  The Dallas Fed’s regional factory index may pull back a little in February, but should remain quite healthy in absolute terms.

Federal Reserve and the Overnight Market

Treasury Finance

This Week's MMO

  • MMO for February 19, 2018

    The Fed has a full analytical agenda ahead of it this year.  There are longstanding questions about its communications strategy to consider, and a number of FOMC members are in favor of a fundamental rethink of the Fed’s flexible inflation targeting framework.  This week’s MMO focuses on a narrower technical issue.  We think the optimal long-run size of the Fed’s balance sheet is much larger than generally assumed in baseline simulations.  We see no reason for the Fed to push bank reserves below $1.5 trillion, which is a level that is likely to be reached within the next year.  It is not too early for the FOMC to begin to focus on the question of what the stopping point for balance sheet normalization should be.

MMO Analysis