Patrick Harker, FOMC member and president of Philadelphia Fed, delivered some comments on monetary policy this afternoon in an interview with CNBC. His comments can be seen as dovish with central bankers suggesting that rates are restrictive enough and that rate cuts may come next year.
Harker's interview highlights
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Open account Try demo Download mobile app Download mobile app- I am seeing an uptick in labor productivity
- There clearly is a tightening of credit
- It is unclear how much tighter credit will impact economy
- I'm not concerned about rise in market yields, they help cool the economy
- I expect an eventual slowdown in economy
- We've probably done enough
- Policy is in restrictive stance
- Shrinking balance sheet is also removing accommodation
- Let the restrictive policy stance play out, it should lower inflation
- I expected unemployment rate to rise to 4%, or just above that
- I am seeing evidence labor market tightness is easing
- I want to see softening in labor market, notably in service sector
- I don't believe AI technology will upend the economy
- I see the US keeping rates where they are all this year, if inflation comes down next year, we could cut rates
- I can't predict when the Fed will cut rates
- If inflation comes down quicker, we may cut rates sooner
While Harker's comments were rather dovish, markets reaction was mixed as both US dollar and US indices lost some ground during his speech.
US dollar index (USDIDX) moved slightly lower following dovish comments from Fed Harker. Source: xStation5
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