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Nov 15, 2013

Yellen signals new emphasis on Fed policing role

NEW YORK (Reuters) – Move over inflation and job growth.

The next Federal Reserve chief appears set to direct the central bank’s might at ensuring financial stability and stern banking oversight with the same vigor it currently applies to its traditional mandates of fostering price stability and maximum employment.

The question of monitoring and stabilizing Wall Street was a dominant issue during Fed chair-designate Janet Yellen’s confirmation hearing before a Senate committee on Thursday. Yellen, widely expected to win Senate backing for the job, said financial regulation should be on par with monetary policymaking on the Fed’s list of priorities.

Nov 15, 2013

Yellen says stronger job growth a Fed imperative

WASHINGTON (Reuters) – Fed Vice Chair Janet Yellen on Thursday robustly defended the Federal Reserve’s bold steps to spur economic growth, calling efforts to boost hiring an “imperative” at a hearing into her nomination to become the first woman to lead the U.S. central bank.

Answering questions before the Senate Banking Committee, Yellen made plain she would press forward with the Fed’s ultra-easy monetary policy until officials were confident a durable economic recovery was in place that could sustain job creation.

Nov 14, 2013

Yellen says imperative to promote very strong recovery

WASHINGTON (Reuters) – Janet Yellen on Thursday robustly defended the Federal Reserve’s bold steps to spur economic growth, calling efforts to boost hiring an “imperative” at a hearing into her nomination to become the first woman to lead the U.S. central bank.

Answering questions before the Senate Banking Committee, Yellen made plain she would press forward with the Fed’s ultra-easy monetary policy until officials were confident a durable economic recovery was in place that could sustain job creation.

Nov 13, 2013

Analysis: Time for Fed to accept that U.S. growth not what it used to be?

NEW YORK/SAN FRANCISCO (Reuters) – Year after year Federal Reserve policymakers have clung to a belief that the U.S. economy will soon regain its pre-recession stride. And year after year they have been wrong.

Now a growing number of economists and at least one top Fed official think Americans should lower their expectations.

Nov 13, 2013

Time for Fed to accept that U.S. growth not what it used to be?

NEW YORK/SAN FRANCISCO (Reuters) – Year after year Federal Reserve policymakers have clung to a belief that the U.S. economy will soon regain its pre-recession stride. And year after year they have been wrong.

Now a growing number of economists and at least one top Fed official think Americans should lower their expectations.

Nov 12, 2013

Two Fed officials say aggressive policy action still needed

PAUL, Minnesota (Reuters) – The Federal Reserve should keep monetary policy ultra-easy given the economy’s tepid growth and an uncertain outlook for jobs growth, two senior officials said on Tuesday, reinforcing views that the U.S. central bank will not taper bond buying before next year.

At the same time, last month’s government shutdown may undermine the reliability of economic data through December, said Dennis Lockhart, president of the Federal Reserve Bank of Atlanta. That could provide another reason not to expect policy action when the Fed holds its next policy meeting, on December 17-18, though Lockhart would not rule it out.

Nov 12, 2013

Fed’s Lockhart: keep policy ‘very accommodative’

MONTGOMERY, Alabama (Reuters) – U.S. monetary policy ought to stay “very accommodative” to foster job creation amid tepid growth, a senior Federal Reserve official said on Tuesday, warning that inflation was too low and this was raising concerns about the durability of the recovery.

Atlanta Federal Reserve President Dennis Lockhart also said last month’s government shutdown may undermine the reliability of economic data through December, hinting at another reason not to expect policy action when Fed officials gather on December 17-18.

Nov 7, 2013

Push to break up too-big US banks doesn’t sway Fed’s Dudley

NEW YORK (Reuters) – One of Wall Street’s top regulators on Thursday said he was not yet convinced by the arguments of some lawmakers and at least one fellow Federal Reserve official that breaking up banks that were “too big to fail” was the right way to protect the U.S. financial system.

New York Fed President William Dudley instead repeated his endorsement of so-called living wills for big banks, but said those needed to be twinned with higher capital and liquidity requirements and incentives for bank management to act to stem problems when they first arise.

Nov 6, 2013

Fed’s Pianalto sounds caution on continued bond-buying

By Jonathan Spicer

(Reuters) – The Federal Reserve should be cautious as it continues to buy up bonds, given the “uncertain economic environment” and the central bank’s limited experience with such quantitative easing programs, a top Fed policymaker said on Wednesday.

“My hope is that the economic recovery will accelerate so that the (Fed) gains the reassurance it needs to begin winding down the program,” Cleveland Fed President Sandra Pianalto told an Ohio housing conference.

Nov 1, 2013

Fed officials eye inflation, jobs in dueling QE arguments

LOUIS/NEW YORK, Nov 1 (Reuters) -

Top Federal Reserve officials on Friday gave only modest
hints as to when a massive bond-buying program would be drawn
down, with one saying they needed to wait for signs of rising
inflation and two others reinforcing an argument the Fed has
waited too long.

Investors are trying to predict when the Fed will decide the
U.S. economy and labor market are strong enough to withstand a
reduction in the pace of quantitative easing (QE), in which $85
billion in assets are snapped up by the central bank each month
to spur growth.