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Recent FedSpeak Highlights

  • Jeffrey Lacker I think the current funds rate has us on track to achieve what we want.  I am comfortable with the funds rate where we are now.

    [ May 22, 2007 ]

    "I think the current funds rate has us on track to achieve what we want," Lacker told reporters after a speech.   I am comfortable with the funds rate where we are now," he said.

    As reported by Dow Jones News

     

  • Janet L. Yellen Economic growth has unexpectedly slowed from “middling” to a crawl, while the unemployment rate has actually inched down and employment growth has remained robust.

    [ April 26, 2007 ]

    The puzzle, as I put it then, was: Why is the labor market apparently going gangbusters, while growth in real GDP has turned in only a middling performance? The reason I’d like to revisit the puzzle is that, in the intervening period, its mystery has deepened: economic growth has unexpectedly slowed from “middling” to a crawl, while the unemployment rate has actually inched down and employment growth has remained robust.

  • Frederic Mishkin Given my estimate of the current level of long-run inflation expectations as well as the likelihood of some easing of resource pressures in labor and product markets, I expect that core inflation will slow to around 2 percent over the next couple of years.  

    [ April 20, 2007 ]

    Given my estimate of the current level of long-run inflation expectations as well as the likelihood of some easing of resource pressures in labor and product markets, I expect that core inflation will slow to around 2 percent over the next couple of years.    

    More From:

    See Also:

    Source:

    http://www.federalreserve.gov/boarddocs/speeches/2007/20070420/default.htm

    Venue:

    Levy Economics Institute of Bard College
  • Michael Moskow We expect to end 2008 with an unemployment rate only somewhat higher than it is now.  Core inflation should gradually come down, moving closer to the levels I view as being consistent with price stability.

    [ April 11, 2007 ]

    We expect to end 2008 with an unemployment rate only somewhat higher than it is now.  Core inflation should gradually come down, moving closer to the levels I view as being consistent with price stability.  

    More From:

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    Source:

    http://www.chicagofed.org/news_room/speeches/2007_04_11_kuc.cfm

    Venue:

    Kenilworth Union Church Public Affairs Program
  • Jeffrey Lacker If inflation doesn't moderate, I believe additional firming would be needed.

    [ April 11, 2007 ]

    If inflation doesn't moderate, I believe additional firming would be needed... 

    Moderating growth doesn't reduce inflation.  Central banks reduce inflation.

    As reported by Bloomberg News

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    Venue:

    Charlotte Economics Club
  • William Poole Chairman Greenspan often wrote with the expectation that people would read between the lines. I think Chairman Bernanke is trying very hard to have people read the lines and not draw implications from reading between the lines when no implication was meant to be there.

    [ April 2, 2007 ]

    The fact that you had very well informed people coming to different conclusions about what the statement meant -- that, in and of itself, is evidence that the statement was not completely successful.   If it were completely clear, well informed people would come to the same conclusion from the same words.

    It is very difficult to craft these statements so that well informed people all come to the same conclusion.  Chairman Greenspan often wrote with the expectation that people would read between the lines. I think Chairman Bernanke is trying very hard to have people read the lines and not draw implications from reading between the lines when no implication was meant to be there.

    From Q&A session, as reported by Bloomberg News

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    Source:

    http://www.stls.frb.org/news/speeches/2007/04_02_07.html

    Venue:

    National Association for Business Economics
  • Ben Bernanke

    I'd say it would be more accurate to say we are looking for a bit more flexibility, given the uncertainties that we are facing and the risks that are occurring on both sides of our outlook.

    An additional point. We, in general, this is more technical, but we, in general, prefer not to give advance rate guidance, that is, not to tell the market we're going to do this, that and the other. Rather, it's better for the FOMC to describe our outlook and the risks that we see for the outlook and let the markets make their own determination about how to price assets. One aspect of this change has been to move away from forward rate guidance, which we view as being something that should be undertaken mostly under unusual circumstances.

    ...

    Our statement included a description both of the situation on the real side of the economy and on the inflation side and our sense was both, that the risks had increased on both sides, that the outlook for output was a bit weaker, as we indicated in our statement, but that, also, the inflation situation had become slightly riskier, as well. And so both sides of the mandate have -- are facing somewhat greater risks.

    From the Q&A session

     

    [ March 28, 2007 ]
  • Frederic Mishkin Looking to the medium term, I am less optimistic about the prospects for core PCE inflation to move much below 2 percent in the absence of a determined effort by monetary policy.

    [ March 23, 2007 ]

    If long-run expectations are in fact about 2 percent, where is actual inflation likely to be headed in the next year or two? While recognizing how embarrassingly wrong such prognostications often turn out to be, I think that we can be reasonably optimistic that core PCE inflation will gradually drift down from its latest twelve-month reading of 2-1/4 percent...

    Looking to the medium term, I am less optimistic about the prospects for core PCE inflation to move much below 2 percent in the absence of a determined effort by monetary policy. For the most part, this assessment--which I should stress is subject to considerable uncertainty--flows from my view that long-term expectations appear to be well anchored at a level not very far below the current rate of inflation. If so, a substantial further decline in inflation would require a shift in expectations, and such a shift could be difficult and time consuming to bring about, as I noted earlier.

  • Michael Moskow ...I still think that the underlying economic fundamentals are conducive to a pickup in growth as we move through 2007 and 2008.  So I am not prepared to significantly change my projections at this time.

    [ March 7, 2007 ]

    ...I still think that the underlying economic fundamentals are conducive to a pickup in growth as we move through 2007 and 2008.  So I am not prepared to significantly change my projections at this time.

  • Randall Kroszner"The outlook for the U.S. economy has not materially changed," Kroszner said during a question-and-answer session at a community banking conference in Washington. 

      "The financial markets seem to be working well and there seems to be sufficient liquidity in the system to respond to the rapid changes that have been occurring recently," Kroszner said, in a nod to recent sharp declines in Asian and U.S. equities markets.

    As reported by Dow Jones Newswires

    [ March 5, 2007 ]

    More From:

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    Source:

    http://www.federalreserve.gov/boarddocs/speeches/2007/200703052/

    Venue:

    American Community Bankers Government Affairs Conference
  • Kevin Warsh The U.S. economy continues to demonstrate extraordinary resilience, no doubt supported by the ability of financial markets to absorb substantial shocks.

    [ March 5, 2007 ]

    The U.S. economy continues to demonstrate extraordinary resilience, no doubt supported by the ability of financial markets to absorb substantial shocks. Financial markets have been buffeted by a number of significant events, including a spate of corporate accounting scandals, the bond rating downgrades of Ford Motor Company and General Motors Corporation to speculative-grade status, the failure of Refco, (at the time the largest broker on the Chicago Mercantile Exchange), and the imposition (and pullback) of capital controls in Thailand. But the effects on broader markets appear to have been remarkably contained. Even the episode last year involving the hedge fund, Amaranth, which accumulated losses of $6 billion in a few short weeks, seemingly had little impact beyond its direct stakeholders.

  • William Poole Recession, I guess in one sense, is always possible. I think the probability is not very high.

    [ March 2, 2007 ]

    Recession, I guess in one sense, is always possible. I think the probability is not very high. I think the probability is a little higher than it might have been two years ago. But the prevailing forecasts certainly do not include recession in the U.S. outlook.

    People who are forecasting a recession are decidedly a minority view at this time.

    More From:

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    Source:

    http://www.stlouisfed.org/news/speeches/2007/03_02_07.html

    Venue:

    Global Interdependence Center Abroad
  • Ben Bernanke My view is that taking all the new data into account, that there is really no material change in our expectations for the U.S. economy.

    [ February 28, 2007 ]

    I will say that the Federal Reserve, in collaboration with the president's working group, has been closely monitoring the markets. They seem to be working well, normally.

    We've also, of course, been closely monitoring the economy, looking at new data and trying to evaluate their implications for the forecast.

    And my view is that taking all the new data into account that there is really no material change in our expectations for the U.S. economy since I last reported to Congress a couple of weeks ago in the Humphrey-Hawkins hearings.

     ...We are looking for moderate growth in the U.S. economy going forward.  And I would add, parenthetically, that the downward revision of the fourth quarter GDP numbers we got this morning is actually more consistent with our overall view of the economy than were the original numbers.

    ...So we expect moderate growth going forward. We believe that if the housing sector begins to stabilize and if some of the inventory corrections that are still going on in manufacturing begin to be completed, that there's a reasonable possibility that we'll see some strengthening of the economy sometime during the middle of the year.

    During Q&A session.

  • Jeffrey Lacker I don't think policy is restrictive, and in fact I see that policy is, if anything, somewhat accommodative.

    [ February 27, 2007 ]

    I don't think policy is restrictive, and in fact I see that policy is, if anything, somewhat accommodative.

    In a Market News interview

    More From:

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    Venue:

    Market News International Interview
  • Janet L. Yellen A key question for inflation going forward —and therefore, for monetary policy—is what happens if the drag from housing and autos disappears later this year? As I’ve stressed, with labor markets apparently somewhat tight, something else will need to slow to keep growth below potential.

    [ February 21, 2007 ]

    A key question for inflation going forward —and therefore, for monetary policy—is what happens if the drag from housing and autos disappears later this year? As I’ve stressed, with labor markets apparently somewhat tight, something else will need to slow to keep growth below potential.

    More From:

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    Source:

    http://www.frbsf.org/news/speeches/2007/0221.html

    Venue:

    Silicon Valley Leadership Group
  • Michael Moskow In my judgment, while some risks to the outlook for growth remain a concern, these have diminished noticeably in recent months.

    [ February 16, 2007 ]

    In setting policy, the Federal Reserve needs to be mindful of the risks to the outlook for both growth and inflation. In my judgment, while some risks to the outlook for growth remain a concern, these have diminished noticeably in recent months. Housing will likely still be a negative for growth during the first half of this year, but it has shown signs of stabilization. And the risks of spillovers to other parts of the economy do not appear to be unduly large.  

  • Ben Bernanke If inflation becomes higher for some reason, the Federal Reserve would have to be respond by raising interest rates.

    [ February 15, 2007 ]

    We have had a period where inflation is above where we like to see it as far as consistency with price stability is concerned. In order for this expansion to continue in a sustainable way, inflation has to be well controlled.  If inflation becomes higher for some reason, the Federal Reserve would have to be respond by raising interest rates.

    In response to a question from Barney Frank  

  • Ben Bernanke In the statement accompanying last month's policy decision, the FOMC again indicated that its predominant policy concern is the risk that inflation will fail to ease as expected and that it is prepared to take action to address inflation risks if developments warrant.

    [ February 14, 2007 ]

    In the statement accompanying last month's policy decision, the FOMC again indicated that its predominant policy concern is the risk that inflation will fail to ease as expected and that it is prepared to take action to address inflation risks if developments warrant.

  • Richard Fisher I wouldn’t rule out further increases in the federal funds rate if inflationary winds gain the upper hand.

    [ February 9, 2007 ]

    I wouldn’t rule out further increases in the federal funds rate if inflationary winds gain the upper hand. Indeed, if increases are needed, I would aggressively advocate for them. But for now, I am as comfortable with the inflationary outlook as a prudent central banker can be. No central banker can ever be smug about containing the risk of inflation, but I am pleased with the current direction of inflationary impulses.

  • Sandra Pianalto Some additional policy firming may be needed - depending, of course, on the outlook for both inflation and economic growth.

    [ February 9, 2007 ]

    The national inflation picture has been clouded in the past few years by large swings in energy, commodity, and housing prices. As these markets normalize, and as we gain a clearer picture of the underlying inflation trend, we may see that some inflation risks remain. In that case, some additional policy firming may be needed - depending, of course, on the outlook for both inflation and economic growth.

    More From:

    Source:

    http://www.clevelandfed.org/dsp_showdetail_PressRel.cfm?contentId=648&detailId=603

    Venue:

    Southwest Florida Speakers Assembly