St. Louis Fed President Alberto Musalem speech, “Financial Conditions, the Economic Outlook and Monetary Policy,” at a Money Marketeers of New York University Inc. event.
More rate cuts likely given economic outlook.Won’t predict timing or size of future Fed easings.Personal rate outlook is above Fed’s median view.Costs of easing too much outweigh easing too little.Supported Fed’s decision last month to cut rates by 50 basis points.Policy patience has served Fed well.Cooler job market still consistent with strong economy.Expects inflation pressures to continue to abate.Expects inflation to converge to 2% over next couple of quarters.Financial conditions remain supportive of growth.Some economic activity slowed by rate policy, election uncertainty.
I stuck that “Costs of easing too much outweigh easing too little” into the main headline of the post. I think its indicative of a push back against expectations of another 50bp cut at the next meeting (November 6 and 7)
This article was written by Eamonn Sheridan at www.forexlive.com.
