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Jun 16, 2014

Factbox: Yellen, future tightening in spotlight as U.S. Fed meets

By Jonathan Spicer

(Reuters) – The U.S. Federal Reserve is widely expected to chop another $10 billion from its monthly bond purchases at a meeting on Tuesday and Wednesday but make few, if any, other concrete policy moves.

Given the lack of drama, all eyes will be focused on whether officials tip their hand on longer-term plans for interest rates.

Jun 12, 2014
via MacroScope

The Fed’s taper and the question of the “tag-along” $5 billion

By Ann Saphir

Federal Reserve policymakers are expected next week to trim their monthly purchases of bonds by another $10 billion, putting them on track to end the massive program by October or December. So – which will it be, October or December? Some Fed officials are pushing for an answer, and soon.

“I am bothered by the fact that I don’t really know what we are going to do on that,” Narayana Kocherlakota, the dovish chief of the Minneapolis Fed, told reporters last month. “It’s another signal that we are not being as clear about our policy choices as we should be.”

Jun 11, 2014

Delay one option on Northern Gateway pipeline -Canada minister

NEW YORK, June 11 (Reuters) – The Canadian government could
technically delay an imminent decision on whether to approve the
controversial Northern Gateway pipeline from Alberta’s oil sands
to the Pacific coast, Natural Resources Minister Greg Rickford
said on Wednesday.

But Rickford’s office stressed he was not signaling a delay
was necessarily the direction the government would take.

Jun 11, 2014

Dove-hawk tradeoff could mean earlier rate rise

SAN FRANCISCO/NEW YORK (Reuters) – A possible tradeoff between opposing camps at the U.S. Federal Reserve could bring about an earlier-than-expected interest rate rise while keeping the U.S. central bank’s balance sheet larger for longer.

Comments from officials anxious to tighten monetary policy as well as from those who want it to remain as accommodative as possible suggest they may balance the timing of a rate rise against when the central bank’s massive securities portfolio should shrink.

Jun 10, 2014

Canada ‘disappointed’ Keystone XL still in limbo -Oliver

NEW YORK, June 10 (Reuters) – Canada is “disappointed” that
the proposed Keystone XL pipeline to the United States has not
yet received approval from the White House, the country’s
finance minister, Joe Oliver, said on Tuesday.

“We are of course anxious for this project to proceed and we
are very disappointed that it hasn’t yet achieved the (U.S.)
presidential approval,” Oliver told reporters before attending
an energy conference hosted by U.S. bank Goldman Sachs.

May 30, 2014

Fed’s Mester stresses stable prices, inflation research

CLEVELAND (Reuters) – The Federal Reserve cannot achieve full U.S. employment over the longer term without stabilizing prices, incoming Fed policymaker Loretta Mester said on Friday, stressing that clear communication will be key as the central bank returns to a more normal policy stance.

Mester, who succeeds Sandra Pianalto as president of the Cleveland Fed on Sunday, gave a speech that was careful not to reveal her stance on monetary policy or the economic outlook. Instead she challenged Fed researchers to help the central bank better understand inflation.

May 30, 2014

US Fed seen sticking to range when hiking interest rates

NEW YORK (Reuters) – Don’t count on the U.S. Federal Reserve to go back to a numerical bulls-eye to aim at when it finally decides to raise interest rates. A target range for the federal funds rate may well be here to stay, at least for the foreseeable future.

While the liftoff for rates is likely a year or more away, Fed officials already have devoted a lot of thought to the mechanics of how they pull off that move.

May 30, 2014

Don’t assume newest Fed policymaker is a look-alike hawk

CLEVELAND, May 30 (Reuters) – The newest Federal Reserve
policymaker is probably not as hawkish as her background
suggests, and Loretta Mester’s expertise in financial markets
and inflation could make a splash as the U.S. central bank
reverses its most accommodative policy experiment ever.

Mester, a Fed veteran of nearly three decades, becomes
president of the Federal Reserve Bank of Cleveland on Sunday
after stepping down as head of research at the central bank’s
Philadelphia branch.

May 21, 2014

Fed’s Kocherlakota floats overshooting U.S. inflation in future

MINNEAPOLIS (Reuters) – U.S. inflation may not climb back to 2 percent until 2018, so the Federal Reserve should consider overshooting that target for a few years afterward to make up for the current period of low prices, a top Fed policymaker said on Wednesday.

Narayana Kocherlakota, president of the Minneapolis Fed, floated the idea of “price level targeting” but did not explicitly endorse it, saying in a speech the idea deserves “serious discussion” at the U.S. central bank.

May 16, 2014

Insight – At big-ticket dinners, a blunt Bernanke sounds theme of low rates

NEW YORK/BOSTON (Reuters) – In a series of quarter-million-dollar dinners with wealthy private investors, Ben Bernanke has been clearer than he ever was as chairman of the Federal Reserve on his expectations that easy-money policies and below-normal interest rates are here for a long time to come, according to some of those in attendance.

Bernanke, who retired from the U.S. central bank in January, has predicted the Fed will only very slowly move to raise rates, and probably do so later than many forecast because the labour market still has a lot more room to recover from the financial crisis and recession.