Gloria ai Bastardi - Cap. 1

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Yellen’s Fed is all about risk management.

Yellen says the Fed ought to be cautious about raising rates because it’s easier for the Fed to react to an upside surprise in growth than to an unexpected slump.

Policy is not on a pre-set path, which means the Fed needs to assess the balance of risks continually.
 
The Fed’s earlier projection for four rate hikes was distinctly at odds with market expectations. Now, with the Fed giving ground, much of that tension has been resolved, analysts say.

“Now, we can say that market and the Fed are on the same page. The statement overall was very dovish even though, it was expected that it could be hawkish, but unquestionably, the Fed does not want to experience what they had to face at the start of this year – a revolting and grisly equity market,” said Naeem Aslam, chief market analyst at Ava Trade, in emailed comments.
 
The global economy is running a bit below expectations, but the global slowdown hasn’t affected the Fed’s baseline case for the U.S. economy, Yellen says.

In part, this is because markets do most of the adjusting that’s required.
 
Un commento di un'analista:

So slower Fed hike path=lower bond yields, higher stocks; lower dollar and higher commodities again
 
La Yellen è preoccupata per il rallentamento della crescita globale rispetto a quanto previsto solo qualche mese fa...
 
People who want certainty are bound to be disappointed.

Yellen says the Fed doesn’t have a credibility problem if it changes its mind depending upon how the economy and financial conditions evolve. The forecasts of individual Fed officials are not promises that the Fed as a institution has made, she says.
 
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