Fed would have benefited from earlier decision to taper, end QE in 2021 – Bowman

  • That would have allowed for earlier rate hikes
  • Would have supported either waiting to slow QT pace or a more tapered slowing in balance sheet run-off
  • In the future, Fed should signal that QE is temporary and unwound when market conditions normalise
  • Prefer for FOMC statements to use more words to describe current economic assessment (Mester)
  • Also to describe how it influences the outlook and the risks to that outlook (Mester)
  • Expects the Fed will consider communications as part of its next policy framework review (Mester)

There’s nothing in there that touches on the current policy settings. It’s mostly a lot of the nuances involving monetary policy and the communique behind that. But I guess the headline remark speaks to how the Fed is lacking the courage to be bold these days.

This article was written by Justin Low at www.forexlive.com. Source