San Francisco Fed Pres. Mary Daly is speaking and says:
- Monetary policy is restrictive.
- Progress isn’t victory, must remain resolute
- To ensure we fully achieve goals, we need to finish the work.
- We need vigilance and agility.
- The economy still has considerable momentum.
- We are a long way from 2% inflation and a long way from sustainable employment.
- Even with recent slowing in the labor market, job growth remains well above what needed to keep pace with growth.
- It’s possible the slowing so far it will translate into steady march towards goal
- There are real risks in inflation projection.
- Will need to see progress on a super – core inflation to be confident we are on path to 2%.
- If continue to see labor market and inflation calling we can hold rates steady
- If financial conditions remain tight, that reduces need for more action from fed
- But if calling inflation stalls or financial conditions loosen, will need to raise rates further
- Need to keep an open mind, have optionality on rates
- With rising bond yields, the need to do additional tightening by Fed is not there
Looking at yields:
- 2 year yield 5.02% -3 basis points
- 5 year yield 4.678% -4.3 basis points
- 10 year yield 4.712% -2.3 basis points
- 30 year yield 4.876% -0.1 basis points
This article was written by Greg Michalowski at www.forexlive.com. Source