WASHINGTON (Reuters) – The weak U.S. September jobs report published Friday is another sign that Federal Reserve policy may be uncomfortably tethered to the strength of the global economy, as a year long swoon in exports helped wipe out manufacturing jobs and slow employment growth.
As it tries to engineer the first U.S. interest rate increase in nearly a decade, the Fed wants economic growth to stay even marginally above what is viewed as its long-term trend of around 2.0 percent. That would allow the country to continue to make up ground lost during the 2007 to 2009 financial crisis and put as many people to work as possible.
WASHINGTON/FRANKFURT, Oct 1 (Reuters) – Central bankers who
led the charge to pull the global economy from a cliff during
the financial crisis now risk becoming bit players, ill-equipped
to snap the world out of sluggish growth and its addiction to
Despite near-zero rates and $7 trillion of monetary stimulus
unleashed by central banks in major industrial economies,
investment and growth is stuck below pre-crisis levels and tepid
demand is hurting developing economies by depressing prices of
their commodity exports.
NEW YORK (Reuters) – New York Federal Reserve Bank President William Dudley said on Monday the Fed remains on track for a likely rate hike this year and could reach its inflation target next year, faster than many other policymakers anticipate.
Dudley said the first hike could come as soon as October as policymakers take stock of an improving economy.
COLUMBUS, Ga (Reuters) – Investors that have roiled global markets and thrown Federal Reserve policy off track should focus on the strength of the U.S. economy rather than the more remote risks of a global slowdown, Atlanta Federal Reserve bank president Dennis Lockhart said on Wednesday.
“Markets should first look at our characterization in the (Federal Open Market Committee) statements and in individual speeches of the economy really being on solid ground and performing well,” said Lockhart, who supported last week’s decision by the Fed to delay an interest rate hike but still says he expects to vote to raise rates some time this year.
NEW YORK/ATLANTA (Reuters) – As the U.S. Federal Reserve’s chief communicator, Chair Janet Yellen is under building pressure among her colleagues and global investors to clarify where the world’s biggest central bank is heading and how it is making its decisions.
The calls have come from both her policy opponents like St. Louis Fed President James Bullard and more centrist sympathizers like Atlanta Fed President Dennis Lockhart, as well as market analysts and investors who say they have been confused about the Fed’s direction.
Sept 19 (Reuters) – Federal Reserve
policymakers appeared deeply divided on Saturday over how
seriously problems in the world economy will effect the U.S., a
fracture that may be difficult for Fed Chair Janet Yellen to
mend as she guides the central bank’s debate over whether to
hike interest rates.
Though last week’s decision to again delay an interest rate
increase was near-unanimous, drawing only one dissent, St. Louis
Fed President James Bullard called the session “pressure-packed”
as members debated whether global uncertainty or the continued
strength of the U.S. economy deserved more attention.
WASHINGTON (Reuters) – The U.S. Federal Reserve kept interest rates unchanged on Thursday in a bow to worries about the global economy, financial market volatility and sluggish inflation at home, but left open the possibility of a modest policy tightening later this year.
In what amounted to a tactical retreat, Fed Chair Janet Yellen said developments in a tightly linked global economy had in effect forced the U.S. central bank’s hand.
WASHINGTON (Reuters) – When the Federal Reserve drove its target interest rate near zero in late 2008, it sparked an economic debate about the risks of having nowhere lower to go, and in particular the financial bubbles it might stoke.
Six years later few bubbles are in sight, but a new risk has emerged: that the zero has become an effective anchor on interest rates that is proving far more difficult to abandon than the Fed expected.
WASHINGTON (Reuters) – The U.S. Federal Reserve kept interest rates unchanged on Thursday in a nod to concerns about a weak world economy, but left open the possibility of a modest policy tightening later this year.
In what amounted to a tactical retreat, the U.S. central bank said an array of global risks and other factors had convinced it to delay what would have been the first rate hike in nearly a decade.
WASHINGTON (Reuters) – Fed Chair Janet Yellen has made clear she would rather delay an interest rate hike for too long than move sooner and risk jeopardizing a tepid economic recovery, a conviction that will face its sharpest test yet on Thursday.
Having weighed the economy’s steady march toward full employment against the backdrop of weak inflation and wage growth and turbulence overseas, the U.S. central bank will issue its latest rate decision at the end of a two-day policy meeting.