Colby Smith @colbyLsmith Twitter profile

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Colby Smith

@colbyLsmith

2 years

. @SenWarren to Powell: "You know what’s worse than high inflation and low unemployment? It’s high inflation and a recession with million of people out of work. I hope you will reconsider that before you drive this economy off a cliff"

Jay Powell warns US recession is ‘certainly a possibility’

Fed chair says economy is resilient but factors beyond his control raise risk of inflation surprises

www.ft.com

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Colby Smith

@colbyLsmith

3 years

First day in a new role at the @FinancialTimes , covering all things US economy, Federal Reserve, IMF and World Bank. Get in touch: colby.smith @ft .com

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Colby Smith

@colbyLsmith

2 years

"Democrats have defied history tonight," @BenLaBolt tells @JamesPoliti . "The story of Joe Biden’s political career is that people always count him out and he always defies expectation and these midterms are another example of that" @FinancialTimes

Democrats’ strategy of portraying Republicans as too radical to govern bears fruit

Joe Biden’s party performs better than expected in US midterm elections

www.ft.com

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Colby Smith

@colbyLsmith

3 years

Nearly 70 market participants parked $756bn at the Fed via its reverse repurchase programme today, a $235bn increase from Wednesday @FT

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Colby Smith

@colbyLsmith

2 years

In an interview with @FinancialTimes , @GitaGopinath of @IMFNews says the sanctions imposed on Russia could lead to a more fragmented int'l monetary system w/ small currency blocs emerging based on trade btwn separate groups of countries @Jonthn_Wheatley

Russia sanctions threaten to erode dominance of US dollar, says IMF

Ukraine war could cause more ‘fragmentation’ in global financial system, warns top official

www.ft.com

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Colby Smith

@colbyLsmith

2 years

Speaking to reporters on Tuesday, Treasury secretary Janet Yellen said the US is "monitoring developments very closely” in the UK @JamesPoliti

Colby Smith

@colbyLsmith

2 years

Biting criticism from @IMFNews of the UK's fiscal plan comes as international criticism grows @FinancialTimes

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Colby Smith

@colbyLsmith

11 months

Mary Daly of the SF Fed tells @lisaabramowicz1 that the recent surge in US Treasury yields is equivalent to roughly a rate hike, suggesting that if sustained, it could dim the need for another increase by the central bank

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Colby Smith

@colbyLsmith

1 year

Federal Reserve announces emergency lending facility "to help assure banks have the ability to meet the needs of all their depositors"

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Colby Smith

@colbyLsmith

1 year

APOLLO: Events this past week correspond to a 1.5% increase in the Fed funds rate. In other words, over the past week, monetary conditions have tightened to a degree where the risks of a sharper slowdown in the economy have increased.

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Colby Smith

@colbyLsmith

1 year

Policymakers at Jackson Hole traded last year’s angst about inflation/central bank credibility for fears that the upheaval of the last three years has rewired the global economy. "You don’t have to throw out the old playbook, but you do need new models"

‘No playbook’: policymakers face up to changing global economy at Jackson Hole

Upheavals have unleashed persistent price pressures that present new challenges, say economists

www.ft.com

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Colby Smith

@colbyLsmith

2 years

Asked about UST illiquidity, Waller says it's about prices and compares it to selling pumpkins post-Halloween: "On Oct 31, the liquidity for pumpkins is very high. But on Nov 1, the market liquidity for pumpkins goes to zero. I'm not going to step in and try to fix [that] market"

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Colby Smith

@colbyLsmith

2 years

The Fed raises rates by 50bps and officials signal fed funds to rise to 5.1% next year. Seven policymakers saw the rate eclipsing 5.25%. Cuts expected in '24/'25 plus most forecast the unemployment rate eventually reaching 4.6%

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Colby Smith

@colbyLsmith

1 year

On that hawkish pause, Fed veteran Vincent Reinhart describes it as a "policy mistake wrapped in a communication error" "They can’t sell it as a prudential delay of policy to await more info when the info you got led you to revise up your forecast 50bps"

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Colby Smith

@colbyLsmith

1 year

The Fed holds its benchmark rate steady for the first time in over a year following 10 consecutive increases, but signals its intention to implement two more hikes in '23 to lift the funds rate to 5.5-5.75%. Officials also raised their core inflation/growth forecasts for year-end

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Colby Smith

@colbyLsmith

2 years

Fed raises rates by 75bps to a target range of 3-3.25%. Officials see fed funds reaching 4.4% at year-end, suggesting one more 75bp hike this year, before peaking at 4.6% in '23. Unemployment set to rise to 4.4% with growth slowing. Core inflation still not at 2% target in '25.

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Colby Smith

@colbyLsmith

2 years

New big read w/ @katie_martin_fx on the mystery of QT's impact on markets. One investor warns it's "not a given" it'll be absorbed easily: "It feels like we’re embarking on this in a rather casual way... We’re watching very carefully. It makes us nervous."

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Colby Smith

@colbyLsmith

3 years

Emerging economies cannot "afford" a redux of the 2013 taper tantrum, @GitaGopinath at @IMFNews tells the @FinancialTimes in an interview

Emerging economies cannot afford ‘taper tantrum’ repeat, says IMF’s Gopinath

Fund’s chief economist sounds cautious note as Fed inches closer to dialling back stimulus

www.ft.com

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Colby Smith

@colbyLsmith

4 years

"Janet Yellen’s appointment will be universally welcomed, and rightly so, including by economists, foreign officials and markets, all of whom regard her as a highly experienced policymaker who delivered years of stability," says @elerianm @JamesPoliti @FT

Janet Yellen prepares for second act at pinnacle of US economic policymaking

Former Fed chair set to take helm at Treasury as coronavirus resurgence threatens recovery

www.ft.com

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Colby Smith

@colbyLsmith

2 years

Powell's message today is that rates are heading higher and poised to stay at a restrictive level for "some time". Says a soft landing will be "very challenging" and that failure to restore price stability is not an option @FinancialTimes

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Colby Smith

@colbyLsmith

4 years

In March, cracks emerged in the biggest, deepest and most essential bond market on the planet. @RobinWigg and I unpack what went wrong and why it matters

US Treasuries: the lessons from March’s market meltdown

The authorities are looking at ways to buttress a market that is the bedrock of the global financial system

www.ft.com

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Colby Smith

@colbyLsmith

2 years

"Shrinkage of the central bank balance sheet is not likely to be an entirely benign process," warns NYU's Viral Acharya during his Jackson Hole presentation. Full paper here:

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Colby Smith

@colbyLsmith

2 years

At Jackson Hole, officials grapple with a changed economic landscape that is poised to make the job of central bankers more difficult. @GitaGopinath tells @FinancialTimes , “there’s a lot of humility in the room [about] what we know and what we don’t know”

Global economy faces greatest challenge in decades, policymakers warn

Rooting out high inflation will become much harder, officials say, as they confront a new economic era

www.ft.com

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Colby Smith

@colbyLsmith

1 year

Central banks take further action on Sunday to improve dollar liquidity. Weekly operations via dollar swap arrangements will now be daily "at least through the end of April"

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Colby Smith

@colbyLsmith

3 years

Persistent inflation/monetary policy tightening is the top risk market participants polled by the Federal Reserve flagged, according to the central bank's latest financial stability report @FinancialTimes

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Colby Smith

@colbyLsmith

2 years

Democrats put up an unexpectedly strong fight as results rolled in from US midterm elections, report @JamesPoliti & @LaurenFedor @FinancialTimes

US Senate in balance in close midterms election battle

Republicans insist they are on course to take back House of Representatives

www.ft.com

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Colby Smith

@colbyLsmith

3 years

The Federal Reserve will have to wind down its pandemic-era stimulus programme quickly and raise rates in 2022 in response to higher inflation, according to a new @FT poll conducted with @ChicagoBooth 's Initiative on Global Markets w/ @christinezhang

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Colby Smith

@colbyLsmith

4 years

"The events in March have, if anything, strengthened the international role of the dollar," says @HyunSongShin at @BIS_org w/ @katie_martin_fx @eva_szalay

Dollar blues: why the pandemic is testing confidence in the US currency

After the greenback suffers its worst month in a decade on economic concerns, debate about its global role is stirring

www.ft.com

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Colby Smith

@colbyLsmith

3 years

Thrilled to join the team! A big thank you to @EricGPlatt , @JARennison , @katie_martin_fx , @RobinWigg , @adamsamson and the rest of the Markets fam for a fun few years

James Politi

@JamesPoliti

3 years

Very happy to say that @colbyLsmith will be joining the DC bureau of the @FT starting this week as US economics editor including coverage of the Fed ! Welcome to the team Colby !

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Colby Smith

@colbyLsmith

2 years

Evercore: "While the UK situation is idiosyncratic in many respects we see a larger lesson here for govts and investors globally: for a period at least, the bond market vigilantes are back." Says UK example reduces the risk that Italy’s new govt will take similar "reckless steps"

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Colby Smith

@colbyLsmith

23 days

Chart by @sam_learner showing the disproportionate impact that housing-related costs are having on the overall inflation rate

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Colby Smith

@colbyLsmith

9 years

Solidarity with France #ParisAttacks

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Colby Smith

@colbyLsmith

2 months

Officially back from parental leave and covering Powell's congressional testimony today. In opening remarks, he hails the "considerable progress" made in beating back inflation, although signals the Fed needs more good data before cutting rates

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Colby Smith

@colbyLsmith

1 year

"The financial system is being tested by the stresses that are being triggered by monetary policy tightening," @TobiasAdrian1 at @IMFNews tells @FT . "The risk going forward is that the situation could create more stressors for the financial system"

Top IMF official warns of ‘acute’ risks in global financial system

Tobias Adrian says banks and other groups are being ‘tested’ by higher interest rates

www.ft.com

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Colby Smith

@colbyLsmith

1 year

For the week ending Wed March 15, US banks tapped the Fed's emergency facilities to the tune of $160bn, with record usage of the discount window and $12bn in loans via the new lending facility announced Sunday

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Colby Smith

@colbyLsmith

3 years

"The nature of scandals like this is that the damage only increases with every day that the public doesn’t hear the full story and how the Fed plans to fix it," says @KalebNygaard of the new disclosures from vice-chair Clarida about his trading activity

Fed trading scandal rekindled by disclosure from top official

Richard Clarida blamed ‘inadvertent errors’ for failing to report stock sales at onset of pandemic

www.ft.com

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Colby Smith

@colbyLsmith

1 year

The Fed says its new lending facility is big enough to cover all US uninsured deposits and that it is "prepared to address any liquidity pressures that may arise" @FinancialTimes

US regulators protect Silicon Valley Bank depositors and shore up financial system

Fed announces new lending facility to provide extra funding to eligible institutions

www.ft.com

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Colby Smith

@colbyLsmith

1 year

The main takeaway today is that the Fed may soon call time on its rate-rising campaign. Powell said there's vast uncertainty re the economic impact from ongoing banking stress and that a pause was even considered

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Colby Smith

@colbyLsmith

2 years

Biting criticism from @IMFNews of the UK's fiscal plan comes as international criticism grows @FinancialTimes

IMF urges UK to ‘re-evaluate’ tax cuts in biting attack on fiscal plan

Multilateral lender warns ‘untargeted’ package risks stoking inflation

www.ft.com

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Colby Smith

@colbyLsmith

1 year

SVB's failure stemmed from weakened regulations during the Trump admin and missteps by internal supervisors who were too slow to correct management's blunders, the Fed concludes in its long-awaited review w/ @brookeamasters @stephengandel @markvdvd

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Colby Smith

@colbyLsmith

1 year

The cost of buying insurance against a US default has shot to its highest level in more than a decade, in an early sign of market concerns about the political impasse in Washington over the debt ceiling @kateduguid @LaurenFedor

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Colby Smith

@colbyLsmith

1 year

Goldman on the X-date: "While the data are still very preliminary, weak tax collections so far in April suggest an increased probability that the debt limit deadline will be reached in the first half of June." Previously they forecast early August.

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Colby Smith

@colbyLsmith

3 years

Elevated inflation will compel the Federal Reserve to raise US interest rates at least twice by the end of 2023, according to a new @FT poll conducted with @ChicagoBooth 's Initiative on Global Markets -- w/ @christinezhang & @brookefox91

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Colby Smith

@colbyLsmith

1 year

Spoke w/ John Williams at @NewYorkFed for the @FT Economists Exchange series. To get inflation to 2%, he forecasts "pretty slow growth" and the unemployment rate eventually peaking at 4.5%. Further tightening is needed, even though policy lags are in play

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Colby Smith

@colbyLsmith

1 year

As the SVB fallout continues, despite emergency measures announced yesterday by the US gov't, attention has turned to regulators who oversee the financial system and how the country’s 16th-biggest bank was allowed to become so vulnerable w/ @stef_palma

Regulators face questions over missed warning signs at Silicon Valley Bank

Experts say red flags at tech lender could have been spotted if banking rules had not been weakened

www.ft.com

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Colby Smith

@colbyLsmith

2 years

Raphael Bostic of @AtlantaFed tells reporters his baseline is a 75bp rate rise in November and a 50bp hike in December: "I'm just going to have that as a starting point and let the data and the reality take me where they will"

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Colby Smith

@colbyLsmith

2 years

Fed minutes: "Some participants indicated that, once the policy rate had reached a sufficiently restrictive level, it likely would be appropriate to maintain that level for some time to ensure that inflation was firmly on a path back to 2 percent"

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Colby Smith

@colbyLsmith

11 months

New @FT piece on buoyant US consumers again defying odds of a more substantive retrenchment to fuel explosive growth over the summer. But such a blistering pace will be difficult to sustain going forward, warn economists

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Colby Smith

@colbyLsmith

2 years

Powell: My base case is that the economy can return to 2% inflation without a really significant downturn or a really big increase in unemployment

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Colby Smith

@colbyLsmith

2 years

Powell uses his Jackson Hole speech to deliver his most hawkish message to date about the Fed's commitment to restore price stability. Harking back to the '70s, he hit back at concerns the Fed lacked the resolve to squeeze the economy to root out inflation

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Colby Smith

@colbyLsmith

2 years

Powell reiterates that the FOMC's baseline is that cuts will not be appropriate this year

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Colby Smith

@colbyLsmith

2 years

Fed trading scandal reignited as Atlanta's Bostic is found to have violated the rules. The Board's ethics officer said he filed "materially incomplete annual disclosures during all prior years in office". Transactions were also made during blackout periods

Atlanta Fed chief’s violation of trading rules reignites ethics scandal

Trades made on behalf of Raphael Bostic were made during blackout period and disclosures found to be ‘incomplete’

www.ft.com

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Colby Smith

@colbyLsmith

1 year

A top concern raised at Jackson Hole was what to do about ballooning public debts. @pogourinchas of @IMFNews told @FT another shock requiring big fiscal aid could pose problems for US/Europe "We don’t have an insurance policy anymore. We are at the edge"

‘No playbook’: policymakers face up to changing global economy at Jackson Hole

Upheavals have unleashed persistent price pressures that present new challenges, say economists

www.ft.com

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Colby Smith

@colbyLsmith

2 years

Powell's message today is that there is still a ways to go in this policy tightening cycle. He warned there could be more upward revisions to the terminal rate forecast, which now points to the funds rate peaking at 5.1% next year @FinancialTimes

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Colby Smith

@colbyLsmith

3 years

Some 50 money market funds and banks parked $485.3bn at the Fed through its RRP facility, underlining the dearth of options for investors given the collapse in yields for the ultra-safe, short-term securities that they typically invest in @FT @EricGPlatt

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Colby Smith

@colbyLsmith

3 years

Excited to continue working with @JamesPoliti and the rest of the team! Any thoughts on the US economy, Federal Reserve, IMF or World Bank? Email me here: colby.smith @ft .com

FT Press Office

@FTPressOffice

3 years

. @FT boosts coverage of US economy with two Washington DC appointments

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Colby Smith

@colbyLsmith

1 year

Jay Powell is set to speak next Friday at 10:05am ET in Jackson Hole. The Fed chair is expected to leave the door open to additional tightening even though some officials seem cautious about further hikes. He is also expected to tout a commitment to a higher for longer stance

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Colby Smith

@colbyLsmith

1 year

Within the space of two months, JPMorgan turned from First Republic adviser to depositor to buyer Our @FT piece on the race to resolve the second-largest bank failure in US history, with @JamesPoliti @JFK_America @brookeamasters @stephengandel

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Colby Smith

@colbyLsmith

4 years

Investors are trapped in what @elerianm calls a "massive tug of war" between pricing in the spectre of renewed economic pain and the "light shining brighter at the end of the Covid tunnel with the vaccine"

Covid vaccine news sends tremors through bond market

Reality check on rollout of treatment stems sell-off in Treasuries

www.ft.com

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Colby Smith

@colbyLsmith

5 years

Pimco, BlackRock and Franklin Templeton are among firms snapping up US inflation-linked bonds, as the Fed embraces the idea of letting consumer price-rises run above target w/ @jennablan

US debt investors seek protection against inflation

Tips in demand as Fed signals it is waiting for ‘persistent’ price rises

www.ft.com

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Colby Smith

@colbyLsmith

5 years

SCOOP: Venezuela's opposition gov't plans to treat equally creditors ensnared in the country’s $150bn web of defaulted debt. No preferential treatment to creditors with court judgments. w/ @RobinWigg

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Colby Smith

@colbyLsmith

3 years

"The ethics rules were not written for a moment like in the spring of 2020," says former Fed staffer @Claudia_Sahm . "It absolutely wasn’t enough when the Fed was doing emergency meetings and financial markets were in incredible distress" @FinancialTimes

Fed under pressure: ‘the ethics need to be as strong as the economics’

US central bank faces calls to clamp down on active trading by officials after scandals shake public trust

www.ft.com

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Colby Smith

@colbyLsmith

2 years

In prepared remarks, John Williams at @NewYorkFed says the unemployment rate could reach 5% next year as the Fed prioritizes its fight against inflation

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Colby Smith

@colbyLsmith

1 year

Hard to see how recent events helps the odds of a soft landing, Chair Powell says. "That pathway exists and we are certainly trying to find it"

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Colby Smith

@colbyLsmith

2 years

New big read on the high stakes for the Fed as it charts the next phase of tightening. As @jc_econ put it: "It’s one thing to be starting from zero and playing catchup, its another to be in the territory where you're clearly closer to a restrictive stance"

The Fed’s dilemma: how long to ‘keep at it’ on inflation

Amid conflicting economic signals and with midterms looming, the US central bank weighs a critical decision over interest rates

www.ft.com

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Colby Smith

@colbyLsmith

2 years

Powell's overarching message today is that even if the Fed slows the pace of rate rises, it is not backing down from its fight against inflation and its too premature to be thinking about a pause: "We've got some ground left to cover here, and cover it we will"

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Colby Smith

@colbyLsmith

2 years

Waller on the inflation forecast: "I got burned last year. We all did, and I'm cautious about getting burned again." Says if MoM inflation comes down to 0.3% and stays that way, "we're not making progress"

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Colby Smith

@colbyLsmith

2 years

Here’s the full @FinancialTimes write-up

Global economy faces greatest challenge in decades, policymakers warn

Rooting out high inflation will become much harder, officials say, as they confront a new economic era

www.ft.com

Philipp Heimberger

@heimbergecon

2 years

The World Bank (!) warns that interest rate hikes by central banks in advanced economies are “ill-suited to address the supply-related inflationary pressures that are driving a significant portion of the recent inflation surge.“

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Colby Smith

@colbyLsmith

3 years

Fed leadership tries to steady policy message after market gyrations w/ @JamesPoliti @FT

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Colby Smith

@colbyLsmith

2 years

The week central banks moved "from whatever it takes to whatever it breaks" w/ @katie_martin_fx @TomStub @MAmdorsky @FinancialTimes

Time for strong medicine: How central banks got tough on inflation

In the US and Europe, policymakers are beginning to accept that dealing with rising prices will not be painless

www.ft.com

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Colby Smith

@colbyLsmith

1 year

Ahead of Friday's jobs report, @TaylorNRogers , @evawxiao and I looked at the rebound in labor force participation among US mothers "It’s not just that women are benefiting from a strong labor market, they’re also driving the strength of the labor market"

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Colby Smith

@colbyLsmith

9 months

Thrilled to have @senoj_erialc covering for me while I’m on parental leave! Reach out to her at claire.jones @ft .com for all things Fed, US economy, IMF and World Bank

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Colby Smith

@colbyLsmith

1 year

Rising oil prices pose fresh headache for president Biden "The danger for the White House is that rising gasoline prices have the power to reverse the sense that the situation is improving and inflation is coming down" w/ @OilSheppard @mylesmccormick_

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Colby Smith

@colbyLsmith

4 years

Zambia, Ecuador and Rwanda have announced recently they are struggling to repay their debts. Many other developing countries are not too far behind. But resolving these debt workouts will be harder than in the past. Big read w/ @RobinWigg @FT

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Colby Smith

@colbyLsmith

1 year

The worst of the global inflation shock may be behind central bankers as they descend on Jackson Hole this week, but policymakers are wary of declaring victory. "They’re really in a place where they have to feel their way forward carefully"

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Colby Smith

@colbyLsmith

3 years

The IMF has now said Afghanistan cannot access the SDRs or other IMF resources

Colby Smith

@colbyLsmith

3 years

The Biden administration has already blocked Taliban access to any Afghan central bank reserves held in US banks, and Republican lawmakers are now looking to stop some $460m of SDRs set to be disbursed by the IMF on Monday @FinancialTimes

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Colby Smith

@colbyLsmith

3 years

The tapering timeline, according to Atlanta Fed president Raphael Bostic @FinancialTimes

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Colby Smith

@colbyLsmith

2 years

"You are gambling with people's lives", @SenWarren tells Powell as she highlights the costs of the Fed's hikes. Asked if Americans are just supposed to "bear it", Powell said: "Will working people be better off if we just walk away from our jobs and inflation remains above 6%?"

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Colby Smith

@colbyLsmith

1 month

Kamala Harris is already embracing the most popular parts of Biden’s economic agenda and legislative wins while drawing a sharp contrast with Trump’s proposals — and hoping that she will be less tarnished than the president by high inflation @JamesPoliti

Kamalanomics: Harris’s economic vision for America’s middle class

Democratic campaign will challenge Donald Trump’s claims to represent working people and secure Joe Biden’s legacy

www.ft.com

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Colby Smith

@colbyLsmith

3 years

“What you don’t know, you don’t ask, and the point of having diversity at the table is someone needs to know enough to say, ‘this could be a problem,’” says @WSpriggs ahead of Thursday’s confirmation hearing for the Fed nominees @FT

First black woman nominated to Fed board faces rocky confirmation

Joe Biden’s push to diversify top ranks of US central bank draws opposition from conservatives

www.ft.com

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Colby Smith

@colbyLsmith

1 year

In an interview with the @FinancialTimes on Friday, Thomas Barkin of @RichmondFed says he is "open to any outcome" for the upcoming policy meeting "Just because you’ve moved it 25 at one meeting doesn’t mean that is what you have to move at every meeting"

Top Fed official signals openness to reverting to half-point rate rise

Richmond Fed president Thomas Barkin tells the FT he remains undecided on decision amid persistent inflation

www.ft.com

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Colby Smith

@colbyLsmith

2 years

Fed gov Chris Waller backs a 25bp hike at the next meeting and spells out a "case for cautious optimism" about the inflation outlook, even as he warns there's still a "considerable way to go" to get to the 2% target "I expect to support continued tightening of monetary policy."

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Colby Smith

@colbyLsmith

2 years

Powell/Clarida cleared in probe investigating top officials' trading activities, but the gov't watchdog found that Clarida failed to report several trades and that a FA of a Powell family trust executed 5 trades during blackout before the Dec '19 meeting

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Colby Smith

@colbyLsmith

1 year

Goldman changes its call to no hike at the March FOMC meeting (previously say a 25bp move) "In light of recent stress in the banking system, we no longer expect the FOMC to deliver a rate hike at its March 22 meeting with considerable uncertainty about the path beyond March"

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Colby Smith

@colbyLsmith

3 years

"Everything points in the same direction when it comes to monetary policy, which is the need to cool down the economy to bring down inflation," @GitaGopinath of @IMFNews told @FT in an interview on the WEO update @ChrisGiles_

IMF warns of ‘multiple challenges’ to global economic recovery

China and US outlooks downgraded amid concerns over higher inflation and geopolitical uncertainty

www.ft.com

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Colby Smith

@colbyLsmith

1 year

ICYMI: Most economists polled by @FT & @ChicagoBooth 's IGM think the Fed will plough ahead w/ rate rises. SVB-related turmoil shaved 25bps off expectations, but fed funds still projected to peak +5.5%. No cuts until '24

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Colby Smith

@colbyLsmith

1 year

New @FT big read on Silicon Valley Bank and the multiple warnings that were missed. W/ @markvdvd , @AntoineGara @FTJFranklin & @Tabby_Kinder

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Colby Smith

@colbyLsmith

3 years

US Treasury market needs urgent reform, warn former policymakers @FT

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Colby Smith

@colbyLsmith

2 years

Speaking w/ @FT , @GitaGopinath of @IMFNews urged the Fed to "stay the course" in terms of its tightening plans given that US inflation has not “turned the corner yet”. She says wage growth/services-related price pressures suggest there's more work to do

US inflation has not ‘turned the corner yet’, top IMF official warns

Fund’s second-in-command urges Fed to ‘stay the course’ on rate rises this year

www.ft.com

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Colby Smith

@colbyLsmith

2 years

Fed officials' new eco forecasts "implicitly" signal a recession, says ex-staffer Vince Reinhart. But he warns the unemployment rate will likely need to rise more than the 4.4% projected in '23/24. Also likely fed funds peaks above the median 4.6% estimate

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Colby Smith

@colbyLsmith

2 years

IMF's gloomy prognosis highlights just how difficult of a task govts and CBs face to manage trade-offs that @pogourinchas says are becoming "hugely challenging". Says risk of monetary/fiscal/financial policy "miscalibration" has sharply risen @ChrisGiles_

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Colby Smith

@colbyLsmith

10 months

"Investors have always worried about government debt and it’s never been a problem, but this time it feels like it’s for real" From our weekend piece on the fiscal reckoning underway from global bond markets, with @marymcdougall13 @Sam1Fleming @kateduguid

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Colby Smith

@colbyLsmith

1 year

The Fed faces one of the tougher decisions of its rate-raising campaign this week as it consider whether to implement another increase w/out knowing if efforts to shore up the banking sector will work in the long term

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Colby Smith

@colbyLsmith

1 year

In the Q&A portion of the event, Wallers says September is a "live" meeting, and it depends on the data. Adds that if the next two CPI reports look like the last one, that may suggest stopping after a July hike.

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Colby Smith

@colbyLsmith

14 days

"The time has come for policy to adjust," says Jay Powell in Jackson Hole. "The timing and pace of rate cuts will depend on incoming data, the evolving outlook, and the balance of risks" The Fed will do "everything we can" to support the labor market

Jay Powell says ‘time has come’ for US interest rate cuts

Federal Reserve chair gives strongest signal yet that borrowing costs will soon fall

www.ft.com

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Colby Smith

@colbyLsmith

1 year

At Jackson Hole, Powell warns the job vanquishing inflation is not yet done and raises the prospect of more hikes should price pressures persist or the economy continues to prove more robust than expected. Says Fed will “proceed carefully" w/ any decisions

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Colby Smith

@colbyLsmith

2 years

Speaking w/ @FT , @hboushey46 says she's optimistic about a soft landing, citing "private sector investments on top of public sector investments in the real economy and in the industrial base of the US", which have "strong multiplier effects" @JamesPoliti

US economy can still pull off ‘soft landing’, says White House adviser

Heather Boushey tells the FT the Biden administration believes large-scale investments will blunt downturn

www.ft.com

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Colby Smith

@colbyLsmith

2 years

"This is as close as IMF language comes to calling a set of policies irresponsible, ill advised and ill timed," @EswarSPrasad says. Calling the statement "unusual in its sharpness", @MarkSobel_OMFIF backs the IMF being "more of a ruthless truth teller"

IMF urges UK to ‘re-evaluate’ tax cuts in biting attack on fiscal plan

Multilateral lender warns ‘untargeted’ package risks stoking inflation

www.ft.com

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Colby Smith

@colbyLsmith

3 years

"Every option is on the table for every meeting," @AtlantaFed 's Bostic tells @FT , despite sticking w/ his 2022 call for three 25bp hikes. "If the data say that things have evolved in a way that a 50bp move is required... then I’m going to lean into that."

Fed could use half-point rate rises if needed, says official

Raphael Bostic insists all options on the table at central bank’s remaining seven meetings this year

www.ft.com

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Colby Smith

@colbyLsmith

2 years

New research by economists at the @KansasCityFed shows that monetary policy lags have shortened: The proxy funds rate had already risen to about 2ppts in Feb '22 before the FOMC increased the actual target for the funds rate in March

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Colby Smith

@colbyLsmith

2 years

Susan Collins of @BostonFed on Friday signals support for smaller rate increases, saying it's "time to shift focus from how rapidly to raise rates, or the pace, to how high". Later on, "we’ll need to shift again to focus on how long to hold rates at that level" @BrookingsInst

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