Fiscal support will be necessary for some time to help the US economic recovery and avoid long-term damage, Federal Reserve Governor Lael Brainard said on Tuesday. Commenting on the policy outlook, Brainard reiterated that negative rates are not attractive for the US.
Additional takeaways
“Forward guidance and yield curve control as complementary tools.”
“Forward guidance can provide a strong boost to the pace of economic recovery and inflation expectations.”
“Expecting forward guidance to provide a very critical role in the future.”
“Yield curve control may become relevant further out but forward guidance remains the core Fed policy.”
Market reaction
The US Dollar Index paid little to no mind to these remarks and was last seen losing 0.27% on the day at 96.27.
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