Monetary policy

The key benchmark that the Federal Reserve targets to control monetary policy dropped for the first time this month, dragged down as growing imbalances in the Treasury-bill market weigh on short-term dollar rates.

The Federal Reserve will likely taper off its bond purchases before considering raising interest rates, Chairman Jerome Powell said.

Federal Reserve Vice Chair Richard Clarida said policy makers will await evidence on whether they’re reaching their goals on price stability and employment before adjusting monetary policy.

Federal Reserve Bank of San Francisco President Mary Daly said she’s “bullish” on the rebound of the U.S. economy, but there is still a long way before the recovery is complete and will wait for the data to show it.

Jack Janasiewicz, senior vice president, portfolio manager and portfolio strategist at Natixis Investment Managers Solutions, discusses inflation and why there is disagreement on whether it will become an issue this year. He talks about how stimulus money and the employment situation factor in. Gary Siegel hosts. (Taped March 9 / 30 minutes).

Federal Reserve Chairman Jerome Powell said prices would rise this year as the pandemic recedes and Americans are able to go out and spend, but he played down the risk that this would spur unwanted inflation.

Dallas Federal Reserve President Robert Kaplan said he is among policy makers estimating that the central bank will have to raise interest rates next year.

The economy seems to be gathering steam, though it is still far from fully recovering from the damage wrought by the pandemic, Federal Reserve Chairman Jerome Powell said.

“Our guidance suggests we would be raising rates were inflation to spike past our targets,” Barkin said.

The Fed remains dovish, although it raised inflation projections and lowered expected unemployment rates, but most participants still see rates at the zero lower bound in 2023.