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The Chairman of the Federal Reserve Board of Governors (FRB), Powell, said at a press conference after the Federal Open Market Committee (FOMC) on the 17th until there was clear evidence that the US economy had recovered by full of coronavirus disease. will not increase rates.
If there is an outbreak of rising inflation, it will abandon the basic line of traditional monetary policy that takes it up beforehand, and it is a major change in line with the new policy framework announced by the US monetary authorities last year. The market has been testing the firmness of the authorities’ resolve in recent weeks by raising yields on US Treasuries.
Fed Chairman Powell
Photographer: Susan Walsh / AP Photo / Bloomberg
Former Fed economist Roberto Perli, now a partner at Cornerstone Macro, said Powell was “optimistic,” and at a press conference said: “As an authority on the new framework and what we are doing now. It was a production that He repeated the same message over and over, saying, “I’m engaged.”
This will allow financial authorities to continue reducing their $ 120 billion monthly bond purchase program until evidence of “more significant progress” on employment and inflation targets has accumulated.
“You can assume we haven’t gotten to that point until we do the signal, and when we get closer, we’re probably on the right track to get there and consider downsizing,” Powell said. I will point out well in advance. “
Lou Crandall, chief economist at Lightson ICAP, said these words and deeds were a “clear break” from the past practices of the US financial authorities. Officials said it was in an interest to control inflation, saying: “They do not consider these risks to be particularly serious and the costs associated with them are not as high as the costs of unnecessarily squeezing economic growth. I know it is not great.”
Original title:Powell Hammers Home Docile message on ‘Clean Break’ with Old Fed （抜 粋）
