NEW YORK (Reuters) – The Federal Reserve’s latest market proposal could help it smoothly raise interest rates and bring far more banks into direct contact with the U.S. central bank in a way that another tool, unveiled last year, could not.
Analysts have applauded a draft Fed idea to offer lenders segregated cash accounts to be used as collateral for transactions with private investors. Such accounts could be an “additional supplementary tool” as the central bank returns to a more normal policy stance, according to minutes of the Fed’s Oct. 28-29 policy meeting, which were released last week.
NEW YORK, Nov 6 (Reuters) – A top Federal Reserve
policymaker on Thursday painted perhaps the clearest picture yet
of how the U.S. central bank should improve the way it forecasts
policy changes and economic developments.
Loretta Mester, president of the Cleveland Fed and a member
of the central bank’s communications committee, detailed three
“suitable amendments” to widely cited charts that the Fed
publishes quarterly showing the expectations of its individual
NEW YORK, Oct 31 (Reuters) – A U.S. Senate subcommittee
hearing is set for Nov. 21 to investigate whether the Fed’s
relationship with the banks it regulates is too cozy, following
the release of secretly recorded conversations between the
Federal Reserve Bank of New York and Goldman Sachs officials.
New York Fed President William Dudley, one of the most
powerful U.S. central bankers, is set to testify before the
subcommittee on Financial Institutions and Consumer Protection,
according to a Senate aide. Other witnesses were not yet
(Reuters) – Two regional Federal Reserve banks have taken steps to replace their hawkish presidents, Charles Plosser and Richard Fisher, whose departures early next year could change the tenor of debate within the U.S. central bank’s policy-setting committee.
The Philadelphia Fed said on Thursday it had hired executive search firm Korn Ferry to find a successor to Plosser, 66, who will retire on March 1 after more than eight years at the helm. A committee of Philadelphia Fed directors working with Korn Ferry will consider “a diverse group of candidates from inside and outside” the Fed, it said.
SAN FRANCISCO/NEW YORK, Oct 29 (Reuters) – Federal Reserve
Chair Janet Yellen persuaded two hawkish colleagues to join her
pledge on Wednesday to keep interest rates low for a long while,
winning them over by sounding an optimistic tone on the U.S. job
market and inflation.
Charles Plosser and Richard Fisher, chiefs of the regional
Philadelphia and Dallas Fed banks, respectively, had dissented
at the U.S. central bank’s last meeting in September and had
argued for ditching a promise not to raise rates for a
“considerable time” after ending a bond-buying stimulus program.
NEW YORK, Oct 29 (Reuters) – An influential U.S. senator
aims to hold a public hearing after secretly recorded
conversations between regulators at the Federal Reserve Bank of
New York and officials at Goldman Sachs raised questions about a
Sherrod Brown, a Democrat on the Senate Banking Committee,
has not yet confirmed a date. But “Brown is working to hold a
hearing,” a spokeswoman said on Wednesday, confirming an earlier
report by Bloomberg.
NEW YORK (Reuters) – The U.S. Federal Reserve this week will likely reinforce its stated willingness to wait a long while before hiking interest rates after a volatile month in financial markets that saw some measures of inflation expectations drop worryingly low.
The reassurance will be all the more necessary given that the U.S. central bank is all but certain to announce the end of its massive bond-buying stimulus when it wraps up a two-day meeting on Wednesday.
NEW YORK/WASHINGTON, Oct 21 (Reuters) – The Federal
Reserve’s New York branch knew about risks JPMorgan Chase & Co
was taking with its massive “London Whale” derivatives bets four
years before they imploded, but it failed to act properly to
head them off, the U.S. central bank’s inspector general said.
The Fed’s Office of Inspector General said on Tuesday one of
the key flaws it uncovered in its probe of the 2008 transaction
at the Wall Street bank was the New York Fed’s over-reliance on
certain personnel who left the supervisory team in 2011. That
created a “significant loss of institutional knowledge” within
the team assigned to inspect JPMorgan, the report said.
BOSTON (Reuters) – The recent volatility in financial markets reinforces the need for the Federal Reserve to be patient with its policy stimulus and to clearly tie an eventual interest-rate rise to improving economic conditions, a top Fed policymaker told Reuters.
Boston Fed President Eric Rosengren said that while it would take a few more weeks to understand the real economic fallout from the market selloff, he could “easily imagine” a scenario in which the U.S. central bank keeps rates near zero until 2016.
BOSTON (Reuters) – Federal Reserve Chair Janet Yellen on Friday said the growth of economic inequality in the United States was not in keeping with American values and she hinted at a range of steps that could address it.
With global stock markets rebounding after frenzied selling, Yellen did not comment on the volatility or on monetary policy. Instead, she ventured into a social critique rare for a U.S. central banker, focusing on the widening gulf between rich and poor.