Correspondent, Chicago
Ann's Feed
Mar 25, 2015

Don’t blame economic doldrums just on weather: Chicago Fed

By Ann Saphir

(Reuters) – Last year’s unusually harsh U.S. winter probably had some transitory effects on economic activity, but the “folk wisdom” that it was primarily to blame for the slump in early 2014 is suspect, a pair of researchers at the Chicago Federal Reserve said on Wednesday.

The theme of harsh weather holding back economic growth is back again this year, with many states registering even colder temperatures than last winter.

Mar 19, 2015

Evans calls for later rate hikes as Fed faces fading growth

SAN FRANCISCO/ATLANTA, March 19 (Reuters) – The Federal
Reserve should err on the side of looser policy, a leading dove
said on Thursday, a day after Fed officials dramatically cut
their forecasts for the economy’s growth, inflation and rate
hikes at the U.S. central bank’s policy meeting.

Chicago Fed President Charles Evans said in a research paper
there was a case for keeping interest rates at zero until at
least 2016, arguing that the risks of a premature rate hike may
be rising if the economy is in fact weakening.

Mar 19, 2015

Fed’s Evans says delaying U.S. rate hikes is ‘optimal’

By Ann Saphir

(Reuters) – The Federal Reserve expects both labor markets and inflation to improve, but those projections are so uncertain that the U.S. central bank should err on the side of looser, not tighter, policy, a top Fed official said on Thursday.

“In this paper, we demonstrate that the zero lower bound on nominal interest rates implies that the central bank should adopt a looser policy when there is uncertainty,” Chicago Fed President Charles Evans said in a draft of a paper for a Brookings Institution conference on Thursday and Friday. “In the current context this result implies that a delayed liftoff is optimal.”

Mar 18, 2015

Fed bows to market’s more dovish view of soaring dollar

NEW YORK/SAN FRANCISCO (Reuters) – The Federal Reserve’s back-pedaling on how aggressively it plans to raise interest rates acknowledges that the more dovish financial markets were right all along: turns out, the soaring dollar has stalled its policy-tightening plan.

The U.S. central bank’s far more modest inflation predictions, released on Wednesday, suggest that the strong currency and sagging oil prices are spooking policymakers more than they have let on. It sets the stage for later rate hikes than they expected, but which many investors have long anticipated.

Feb 21, 2015

Contract negotiators for U.S. West Coast ports reach tentative deal

SAN FRANCISCO (Reuters) – Shipping companies and terminal operators clinched a tentative deal with the dockworkers union on Friday, settling a labor dispute that led to months of cargo backups at 29 U.S. West Coast ports and snarled trans-Pacific maritime trade with Asia.

The deal, confirmed by a source close to the situation, was reached after the U.S. labor secretary arrived in San Francisco this week to help broker negotiations that had dragged on for nine months between the shippers and the International Longshore and Warehouse Union.

Feb 20, 2015

No deal yet in U.S. West Coast port dispute; talks to continue

By Ann Saphir and Steve Gorman

(Reuters) – Shipping executives and union leaders for dock
workers at 29 U.S. West Coast ports remained locked in a dispute
on Friday as talks, brokered by the U.S. labor secretary, headed
into a fourth straight day.

Negotiations ended late Thursday with no deal, two sources
close to the talks told Reuters Friday, adding that there is
more work to do in discussions set to resume in the morning.

Feb 20, 2015

Status of U.S. West Coast port dispute unclear: Journal of Commerce

SAN FRANCISCO (Reuters) – The status of a dispute between shipping executives and union leaders for dock workers at 29 U.S. West Coast ports was unclear on Friday, with the Journal of Commerce, which earlier reported a deal may have been reached, saying conflicting reports had emerged on the status of the nine-month-old talks.

“There is no deal as it stands right now,” Journal of Commerce Chief Content Officer Peter Tirschwell told Reuters.

Feb 19, 2015

Bullard says worried Fed is falling behind the curve

By Ann Saphir

(Reuters) – A Federal Reserve official on Thursday redoubled his call for the U.S. central bank to start raising interest rates soon, saying he fears that waiting too long could spell a “harrowing and disruptive” time for the Fed and the economy.

Predicting U.S. unemployment will fall below 5 percent by the third quarter of this year, St. Louis Fed President James Bullard said he wants the Fed’s policy-setting committee to next month drop its pledge to be “patient” in deciding to raise rates, opening the door to a June rate hike.

Feb 12, 2015
Feb 12, 2015

Insight – Shifting goal posts on employment may signal slower Fed rate hikes

SAN FRANCISCO/WASHINGTON (Reuters) – Officials at the Federal Reserve are debating a historic shift in one of its core economic gauges that could lead the central bank to move even more slowly than now thought once it lifts its rates from rock bottom levels.

According to interviews with half a dozen current and former Fed policymakers and staff, the concept that the economy can produce far lower levels of unemployment without stoking inflation is being built into Fed models and becoming increasingly entrenched in the central bank’s views.