- Q3 GDP likely above 3%, led by healthy consumer spending
- Business likely rising at about a double digit pace
- Capex is historically high
- Employment conditions are positive
- The committee believes more information will help determine appropriate policy steps
- Credit conditions have tightened for some households and businesses
- I’m unwilling and unable to call financial conditions tight
- Inflation is too high
- Energy and related prices have moved higher again in recent weeks
- Our job is to make sure inflation doesn’t broaden out
- We have shown our readiness to act
- In 2027, will have 8 meetings but one meeting will not have a vote.
- In 2028, will have 8 meetings but two won’t have a vote
- Change will allow a focus on longer-term deliberations
This sounds like a hawkish lean, which is what’s already priced into markets with 22 bps priced in for the December 9 meeting.
Q&A:
The first question was about ‘why not hike today” and he said took a long victory lap (for some reason), then said:
- Inflation expectations have gone the right way
- I feel good about the signposts
- The period in front of us is information rich
- I’m encouraged by the progress we’ve made
- The overwhelming consensus is the monetary medicine we’ve used is that “it’s worked some”
The US dollar is lower on Warsh’s comments, in part because he’s saying that the one hike has worked or is working.
This article was written by Adam Button at investinglive.com.