Monetary policy

The U.S. economy will likely meet the Federal Reserve’s threshold for tapering its asset purchases sooner than people think, said Dallas Fed President Robert Kaplan, who has penciled in an interest-rate increase next year.

Federal Reserve Bank of Atlanta President Raphael Bostic said the central bank could decide to slow its asset purchases in the next few months and he favored lifting interest rates in 2022 in response to a faster-than expected recovery from COVID-19 pandemic.

Federal Reserve Chair Jerome Powell said the price increases seen in the economy recently are bigger than expected but reiterated that they will likely wane.

A discussion about raising interest rates is still quite a ways off as the Federal Reserve begins debating tapering its bond-buying program, New York Fed President John Williams said.

Federal Reserve Chair Jerome Powell said inflation had picked up but should move back toward the U.S. central bank’s 2% target once supply imbalances resolve.

Inflation risks may warrant the Federal Reserve beginning raising interest rates next year, St. Louis Fed President James Bullard said, backing an even-earlier liftoff than penciled in by many of his colleagues.

The Federal Reserve’s prestigious annual Jackson Hole policy symposium will be held in person this year, albeit in a modified form.

U.S. central bank officials may be able to begin discussing the appropriate timing of scaling back their bond-buying program at upcoming policy meetings, Federal Reserve Vice Chair Richard Clarida said.

Morgan Stanley Chief Executive Officer James Gorman said he expects the U.S. Federal Reserve to begin tapering its bond buying toward the end of this year and start raising interest rates in early 2022, faster than the Wall Street bank’s own economists forecast.

Factors pushing U.S. inflation higher are likely to ebb at the start of 2022, said Federal Reserve Bank of San Francisco President Mary Daly.

The Federal Reserve should get a conversation going on tapering its bond-purchase program “sooner rather than later,” Philadelphia Fed President Patrick Harker said.

The Investment Company Institute reported another week of inflows, but at a lower clip than recent weeks with $541 million coming into municipal bond mutual funds.

The Federal Reserve’s policy is in a good place right now, said Cleveland Fed President Loretta Mester, while playing down signals from data that she warns will be volatile as the economy reopens.

The U.S. labor market remains in a “deep hole” and needs aggressive support to speed its healing from the COVID-19 pandemic, said Federal Reserve Bank of Minneapolis President Neel Kashkari.

It will probably take “quite some time” for Federal Reserve officials to conclude the economy has made substantial progress following Friday’s disappointing jobs report, Chicago Fed President Charles Evans said.

Federal Reserve Bank of Minneapolis President Neel Kashkari said he has “zero sympathy” for critics on Wall Street, who slam the central bank’s aggressive support of the U.S. economy while millions of Americans remain out of work.

A rising appetite for risk across a variety of asset markets is stretching valuations and creating vulnerabilities in the U.S. financial system, the Federal Reserve said in its semi-annual financial stability report.

Treasury Secretary Janet Yellen said she was not predicting or recommending interest-rate increases when remarking earlier about the impact of fiscal spending on the U.S. economy.

A senior White House economic aide said the decision on selecting the next central bank chief will come after a thorough “process.”

Inflationary pressures remain high while the manufacturing sector continues to deal with supply chain woes that hold it back, analysts said.