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Federal Reserve:Meetings/2023 September 20: Difference between revisions
Federal Reserve:Meetings/2023 September 20 (view source)
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* '''Need to see more progress before be willing to reach the conclusion that rates are at an appropriate level.''' They will continue to asses the data carefully, the decision at each meeting and certainly at the last two meetings this year, it's going to depend on the totality of all the data. So the inflation data, the labor market data, the growth data, the balance of risks and the other events that are happening out there. | * '''Need to see more progress before be willing to reach the conclusion that rates are at an appropriate level.''' They will continue to asses the data carefully, the decision at each meeting and certainly at the last two meetings this year, it's going to depend on the totality of all the data. So the inflation data, the labor market data, the growth data, the balance of risks and the other events that are happening out there. | ||
* '''If the economy comes in stronger than expected, that just means we'll have to do more in terms of monetary policy to get back to 2 percent.''' | * '''If the economy comes in stronger than expected, that just means we'll have to do more in terms of monetary policy to get back to 2 percent.''' | ||
* '''It may be that the neutral rate has risen'''. There are people raising their estimates of the neutral rate, and it's certainly plausible that the neutral rate is higher than the longer-run rate (SEP is the longer-run rate). It is possible that the neutral rate at this moment is higher than that and | * '''It may be that the neutral rate has risen'''. There are people raising their estimates of the neutral rate, and '''it's certainly plausible that the neutral rate is higher than the longer-run rate''' (SEP is the longer-run rate). It is possible that the neutral rate at this moment is higher than that and that's part of the explanation for why the economy has been more resilient than expected. | ||
* Currently their are focus in finding the appropiate level of real rates, then they will focus how long it needs ot stay at that level. | * Currently their are focus in finding the appropiate level of real rates, then they will focus how long it needs ot stay at that level. | ||
* The time will come at some point, without saying when, that it's appropriate to cut. Part of that may be that real rates are rising because inflation is coming down. Part of it just may be that it'll be all the factors that we see in the economy. | * The time will come at some point, without saying when, that it's appropriate to cut. Part of that may be that real rates are rising because inflation is coming down. Part of it just may be that it'll be all the factors that we see in the economy. | ||