Former Dallas Federal Reserve President Robert Kaplanspoke in an interview with US media, CNBC, on Thursday.
Kaplan spoke about Powell’s less-than-hawkish press conference:
- “This was a conversation destined to happen. He had to preview it at some time, and chose yesterday”
- “People should not overreact to what he said. He left his options open. He thinks they’re done, it’s likely the next move will be down, but he’s keeping his options open.”
Honestly, I think Kaplan is overreacting to ‘keeping his options open’. Powell didn’t shut the door on future rate hikes, he’d be a fool to rule that out. And, he is not a fool.
Kaplan was forced out of his job at the Fed for untoward trading while in office. To his credit, he was a lone voice warning about dangerously rising inflation when all his colleagues were parroting the ‘transitory’ line that proved so costly in delaying the start of the Fed’s rate hike cycle. A mistake repeated in many DM central banks.
This article was written by Eamonn Sheridan at www.forexlive.com. Source