Tags: federal reserve | powell | rates | patient

Fed Aims Not to Surprise Markets When it Drops 'Patient' -Powell

Thursday, 19 February 2015 06:49 AM


A Federal Reserve official, asked how the central bank plans to manage market expectations when it eventually drops the key "patient" word from its policy statement, said the Fed aims not to surprise investors.

"Our agenda is not to surprise markets," Fed Governor Jerome Powell said on Wednesday at New York University. "It is to be as clear and transparent as possible, to keep our framework out there, and let markets understand where we're going."

The Fed has repeated it will be "patient" as it considers when to raise interest rates, to reflect an improving economy. Investors have zeroed in on the word, which Fed Chair Janet Yellen has said means that no policy tightening is coming for at least three months.

Minutes of the Fed's January meeting show officials fretted about how markets will react when the word is finally dropped. With bond yields now very low, an aggressive reversal could harm the broader economy.

Powell, an influential voice at the Fed, said the rising dollar was a "headwind" for the U.S. economy but should not stop its economic momentum. "That's what we will be looking at" in considering a rate hike, he said.

He cited "really strong job creation" in the last six months including a January employment report that "had everything." The job market is "printing numbers that no one even imagined we would print" three years ago, Powell said after giving a speech on risks lurking in leveraged loan markets.


© 2019 Thomson/Reuters. All rights reserved.

   
1Like our page
2Share
Finance
A Federal Reserve official, asked how the central bank plans to manage market expectations when it eventually drops the key patient word from its policy statement, said the Fed aims not to surprise investors.
federal reserve, powell, rates, patient
244
2015-49-19
Thursday, 19 February 2015 06:49 AM
Newsmax Media, Inc.
 

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
America's News Page
© Newsmax Media, Inc.
All Rights Reserved