Below are some key takeaways from the speech delivered by the FOMC Chairman Jerome Powell at an Economic Club of New York luncheon.
- Gradual rate hikes balance risks to forecast.
- ‘Great deal to like about’ U.S. Economic outlook.
- Fed balancing risks of shortening expansion on one hand, higher inflation and instability on other.
- Repeats sees ‘moderate’ overall vulnerabilities to financial stability.
- Expects solid U.S. Growth, low unemployment, near-target inflation.
- No pre-set policy path; paying ‘very close attention’ to data.
- ‘Close’ to price stability, maximum employment mandates.
- Policy rate ‘just below’ estimates of neutral.
- Concerned about leveraged corporate borrowing, which could exacerbate economic downturn.
- Losses related to leveraged borrowing unlikely to imperil core financial firms, overall stability.
- No dangerous excesses in stock market.
- Fed working with U.S. Firms to prepare for full range of Brexit outcomes.
- New financial stability report aims to boost democratic legitimacy of Fed.
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