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Oct 17, 2014

Citing U.S. values, Yellen says greatly concerned by rise in economic inequality

BOSTON (Reuters) – Federal Reserve Chair Janet Yellen said on Friday the growth of economic inequality in the United States “greatly” concerned her, and suggested in a detailed speech on the politically charged issue that Americans should ask whether it was compatible with their values.

With global financial markets rebounding from days of frenzied selling, Yellen did not comment on the volatility or on monetary policy. Instead she focused on the gulf between rich and poor that has only grown wider over the last several decades and, she said, through the U.S. economic recovery.

Oct 16, 2014

Fed likely to end bond buying, may signal caution on rate hikes

By Jonathan Spicer, Michael Flaherty and Ann Saphir

(Reuters) – The Federal Reserve is likely to reassure investors later this month that it won’t stand idle if global turbulence threatens the U.S. economy, but a proposal from one top policymaker to keep on buying bonds looks to be a bridge too far.

James Bullard, who heads the St. Louis Fed, suggested on Thursday that sticking with bond purchases for a few more months would give policymakers the time needed to assess a recent deterioration in the inflation outlook.

Oct 16, 2014

Fed official wants to keep up QE as inflation expectations slip

Oct 16 (Reuters) – The Federal Reserve should keep buying
bonds for longer than planned in the face of volatile markets
and falling inflation expectations, a top U.S. central banker
said on Thursday, even as another Fed policymaker warned against
an over-reaction.

James Bullard, president of the St. Louis Fed, is the only
official at the central bank to publicly suggest putting on hold
the Fed’s widely telegraphed plan to halt its asset-purchase
program later this month. Yields on U.S. bonds, which have
plunged the last few days, rebounded after his comments.

Oct 16, 2014

Fed still on course for rate rise around mid-2015 say economists: Reuters poll

By Jonathan Spicer and Rahul Karunakar

(Reuters) – The Federal Reserve is still set to raise interest rates by mid-2015, according to a Reuters poll of economists that also found a better-than-even chance bond markets are underestimating how quickly policy will eventually tighten.

The latest poll, conducted Oct 8-15 in the midst of widespread selling on global stock markets, stands in contrast to U.S. interest rate futures markets which in recent days have pushed off the timing of the first hike to late next year.

Oct 14, 2014

Exclusive: Fed’s Williams downplays global risks, eyes U.S. inflation

WASHINGTON (Reuters) – A bellwether Federal Reserve policymaker on Tuesday downplayed concerns about weakness in the global economy, saying the U.S. central bank should only delay an interest rate hike next year if inflation or wages fail to perk up.

John Williams, president of the San Francisco Fed, said in an interview with Reuters that the first line of defense at the central bank, if needed, would be to telegraph that U.S. rates would stay near zero for longer than mid-2015, when he currently expects them to rise.

Oct 14, 2014

Fed’s Williams downplays global risks, eyes U.S. inflation

WASHINGTON, Oct 14 (Reuters) – A bellwether Federal Reserve
policymaker on Tuesday downplayed concerns about weakness in
the global economy, saying the U.S. central bank should only
delay an interest rate hike next year if inflation or wages fail
to perk up.

John Williams, president of the San Francisco Fed, said in
an interview with Reuters that the first line of defense at the
central bank, if needed, would be to telegraph that U.S. rates
would stay near zero for longer than mid-2015, when he currently
expects them to rise.

Oct 14, 2014

Exclusive – Fed’s Williams unmoved by global risks, eyes U.S. inflation

WASHINGTON (Reuters) – A bellwether Federal Reserve policymaker on Tuesday downplayed concerns about weakness in the global economy, saying the U.S. central bank should only delay an interest-rate hike next year if inflation or wages fail to perk up.

San Francisco Federal Reserve Bank President John Williams said the first line of defence at the Fed, if needed, would be to telegraph that U.S. rates would stay near zero for longer than mid-2015, when he currently expects them to rise.

Oct 14, 2014

Exclusive: More QE might be appropriate if U.S. economy faltered- Fed’s Williams

WASHINGTON (Reuters) – The head of the San Francisco Federal Reserve Bank on Tuesday said he would be open to another of round asset purchases if inflation trends were to fall significantly short of the U.S. central bank’s target.

Although he said it would take a big shift in the U.S. economic outlook for the Fed to restart its bond buying, John Williams said the possibility of a new downturn in Europe and other global economic woes pose a risk to the United States.

Oct 9, 2014

BoJ has many policy easing options if needed: Kuroda

NEW YORK (Reuters) – The Bank of Japan has many tools available if it were to ease monetary policy further, Governor Haruhiko Kuroda said, adding that the Japanese government bond (JGB) market is a “huge” one among various financial assets the central bank can tap.

“There are many options available, and if necessary we will not hesitate to make any necessary and appropriate” moves to achieve the BOJ’s 2 percent inflation target, Kuroda told the Economic Club of New York on Wednesday.

Oct 8, 2014

Fed minutes show debate on changing rate guidance heating up

WASHINGTON/NEW YORK (Reuters) – The Federal Reserve’s debate on its interest rate guidance heated up last month, with several officials showing concern about misleading investors and pushing for a more data-dependent approach, according to minutes from its last policy meeting.

But as the Fed grapples with how to communicate its view on hiking rates, the minutes also show concern about the rising dollar, slowing inflation, and economic turmoil in Europe and Asia, factors that support the U.S. central bank’s current of keeping policy accommodation in place for the near future.