Federal Open Market Committee (FOMC)
People: Yellen to leave Fed in February; Curaçao names temporary governor
Janet Yellen to step down from Fed board; retirement crisis sees flurry of appointments at Curaçao and Sint Maarten; Carstens hands in chairmanship at IMFC; and more
Trump nominates Jerome Powell as Fed chair
As a Fed governor, Powell has never issued votes of dissent against FOMC decisions
FOMC shrugs off hurricane damage
Rates on hold as committee judges economy to have weathered damage from two hurricanes
The candidates knocking at Yellen’s door
Leading academics and economists weigh the competency of the top candidates for the Fed job – and how likely they are to win Trump’s favour
FOMC split over inflation forecasts, minutes show
Participants expressed concern that low inflation this year might reflect not only transitory factors
US economy would have performed better without rate hikes – Kashkari
Minneapolis Fed president says Fed should not raise rates until 2% inflation target has been reached; removal of accommodation has negatively affected inflation expectations
Don’t underestimate the Fed’s balance sheet unwind – Fischer
Stanley Fischer offers advice to colleagues in his final scheduled speech before leaving in October: “never say never”
Banks ‘still groping toward’ macro-pru transparency – Eichengreen
Central bank governance expert says central bank transparency is getting better around the world, although New Zealand, Argentina and some Central American institutions could make improvements
Atlanta’s Bostic ‘sceptical’ about low inflation factors
President of Atlanta Fed is not sure technology and competitive pressures are to blame for prolonged below-target inflation
Eichengreen supports calls for FOMC to hold more press conferences
Governance expert says Fed is one of the most transparent central banks in the world but improved consistency of format around FOMC meetings “makes sense”
Chicago Fed’s Evans sees little risk of inflation surge
Study by the Chicago Fed finds little evidence there could be a threshold in unemployment beyond which inflation may surge
FOMC triggers balance sheet wind-down
Fed will begin allowing securities to roll off its balance sheet from October; Janet Yellen stresses changes will proceed gradually
FOMC divided on how to proceed with policy
Strong jobs growth, but below-target inflation leaves some members emphasising room to be patient, while others warn of a potential overshoot
Fed to begin shrinking balance sheet ‘relatively soon’
Rates remain on hold as the FOMC eyes below-target inflation, while the wording change implies that action on the balance sheet could begin sooner than previously expected
Brainard cautious over further hikes in interest rates
Fed governor says she will be watching inflation “carefully” over the coming months, stating the unwinding of the balance sheet will begin ”soon”
Bullard raises concerns about east coast dominance of the Fed
St Louis Fed president is not worried about the major shake-up of the board of governors; points to reducing the influence of the New York Fed on the FOMC
Inflation data causes rift in FOMC
Fed officials discuss whether incoming low inflation data is “transitory” or is a sign of worrying things to come; minutes outline balance sheet unwinding but date remains unknown
Yellen told inflation target needs revising
Economists say current economic conditions call for a revision in the inflation target; Federal Reserve should appoint commission to advise on “path forward”
Book notes: Fed Up, by Danielle diMartino Booth
A “fascinating but annoying” account by a US Federal Reserve insider who openly criticises the culture of the US central bank and policy decisions made by the institution leading up to and following the financial crisis
Inflation is preventing interest rates from rising faster, says Powell
Labour market progress points towards a faster pace of normalisation for the Fed, but below-target inflation is preventing rates from rising above the current “gradual pace”
Brainard turns cautious on inflation concerns
Lack of wage growth and lower than expected inflation data could slow further monetary easing, says Fed governor; interest rates are likely to rise “soon”
Fed minutes shed light on balance sheet shrinkage plan
System of caps would allow gradual reductions in the reinvestment of securities held under the QE programme
‘Our independence is under threat’ – Yellen
Fed chair cites two legislative bills that could significantly harm the central bank’s ability to make independent monetary policy decisions; US economy is being allowed to “coast”
FOMC mulls ‘predictable’ balance sheet wind-down
One FOMC member says a “minimum pace” should be set for the reduction in mortgage-backed securities; committee will inform the public about its future plans for the balance sheet when the time comes