North America

  • 2019-12-11 15:11


    WASHINGTON (MNI) - The following is the portion of a transcript from Federal Reserve Chairman Jerome Powell's press conference after the FOMC meeting Wednesday:

    Q: does the fed's dot plot still serve a useful communications purpose or do you feel it might be time to retire it or change it in some fashion?

    A: I think properly understood, it can be useful. But that's been a challenge. I think properly understood to me means looking at what it is and not at what it isn't. What it is, is a expression of the thinking about individual committee members, about appropriate monetary policy and the path of the economy. Remember that we write all that down and we send it in, and it gets compiled. But we don't discuss it at the meeting. We don't negotiate. There is no agreement.

  • 2019-12-11 15:09


    WASHINGTON (MNI) - The following is the portion of a transcript from Federal Reserve Chairman Jerome Powell's press conference after the FOMC meeting Wednesday:

    Q: what would you imagine the economic effect would be if negotiations with China were to fall apart, and how would the fed be able to support the economy in that event?

    A: I wouldn't want to speculate on a hypothetical. I would say, we will have to say. We look at a range of factors and as I've said, we look through the volatility in trade news and trade negotiations, we try not to react. We can't react. Monetary policy is not the right tool to react in the very short term to volatility and things that can change back and forth as has happened, as is probably typical of a large complex negotiation.

  • 2019-12-11 15:07


    WASHINGTON (MNI) - The following is the portion of a transcript from Federal Reserve Chairman Jerome Powell's press conference after the FOMC meeting Wednesday:

    Q: You started by talking about Paul Volker who cast a long shadow. I wonder if in hindsight that shadow was too long, and if in the decade since his tenure and in particular last year, if the fed was too quick to raise interest rates, to attack an inflation boogeyman that didn't materialize.

    A: This wouldn't be, my response will not be about Paul Volker. But so though you started with Paul Volker. If you look at 2018, I'll take you back to the beginning of 2018, we had a economy growing at 3 percent, we had inflation at 2 percent.

  • 2019-12-11 15:05


    WASHINGTON (MNI) - The following is the portion of a transcript from Federal Reserve Chairman Jerome Powell's press conference after the FOMC meeting Wednesday:

    Q: I want to ask the only change in the statement was a drop in the reference to uncertainties around the economy. You seem confident or it implies there is a lot of confidence that those uncertainties have gone away. What caused you to make that change for this statement, what were you looking at?

    A: We did actually, if you look at the statement, you will notice that we did call out global developments and muted inflation pressures later in the statement. Why did we do that? Those are things that we have been monitoring all year.

  • 2019-12-11 15:02


    WASHINGTON (MNI) - The following is the portion of a transcript from Federal Reserve Chairman Jerome Powell's press conference after the FOMC meeting Wednesday:

    Q: I want to ask more about the repo issues and what you are doing beyond open market operations. Are you currently, for example, telling examiners not to prefer reserves over treasuries for supervisory purposes? Are you talking to the treasury department about reducing the level of volatility in their account at the fed? On the standing repo facility, is it that you would be inclined to do it but you need to figure out the details? Or what would drive the decision on whether or not to do that?

    A: So on treasuries versus reserves, we have done a ton of work on that.

  • 2019-12-11 14:59


    WASHINGTON (MNI) - The following is the portion of a transcript from Federal Reserve Chairman Jerome Powell's press conference after the FOMC meeting Wednesday:

    Q: Chair Powell, the fed policy review this year has been largely discussed in terms of the inflation side of the mandate and the need to sharpen inflation expectations. But it seems like the message you have been getting from the fed events and something you acknowledged that the fed has been systematically overestimating labor utilization throughout this expansion, so I'm wondering if you can talk about the extent to which the review is looking at the employment side of the mandate as well.

  • 2019-12-11 14:56


    WASHINGTON (MNI) - The following is the portion of a transcript from Federal Reserve Chairman Jerome Powell's press conference after the FOMC meeting Wednesday:

    Q: We talked about inflation. I want to ask about uncertainty. With the house announcing that they will ratify USMCA and Canada and Mexico signing off on it, do you see uncertainty easing now so the business investment could pick up? Or the trade tensions with China, are just that big elephant in the room, where you might not see those business investments pick up?

    A: Well, I did see the news today, that it appears there is agreement to move forward to revote on USMCA and of course it's not our role to comment on particular trade policies or criticize them one way or the other or evaluate them.

  • 2019-12-11 14:53


    WASHINGTON (MNI) - The following is the portion of a transcript from Federal Reserve Chairman Jerome Powell's press conference after the FOMC meeting Wednesday:

    Q: I want to ask about the framework review which entails debate around allowing a overshoot of the 2 percent target, and in that context, it's merely saying that you want inflation to rise above 2 percent a sufficient strategy, for getting inflation to stay the target, or would it compel some kind of policy action beyond deferring future rate increases to achieve that outcome, if that is the direction in which the committee goes.

  • 2019-12-11 14:52


    WASHINGTON (MNI) - The following is the portion of a transcript from Federal Reserve Chairman Jerome Powell's press conference after the FOMC meeting Wednesday:

    Q: Given that inflation, whichever measure you choose has either remained where it is or not increased over the past year, as you have been dropping the policy rate, what is it that gives you confidence that the fed has the tools to get inflation back up to target, or even overshoot as you just indicated that some people are considering doing?

    A: Well, it's just that there is still empirically by many different, by the work of many different analysts, there is a relationship between resource utilization by which I mean unemployment and inflation. It is just relatively weak. By the way, that is not a bad thing.

  • 2019-12-11 14:50


    WASHINGTON (MNI) - The following is the portion of a transcript from Federal Reserve Chairman Jerome Powell's press conference after the FOMC meeting Wednesday:

    Q: if you look at the SEP today, it looks like inflation is never overshooting 2 percent and is only getting up to 2 percent by the end of 2021, yet rates are increasing in 2021. How do we square that circle with interest rates increasing before inflation ever moves up in some meaningful overshooting way?

    A: I think what you are saying is you have got a full year of the median being flat which is come dative, modestly accommodative and inflation not moving up much. That underscores the challenge of getting inflation to move up.