Fed Policy & Inflation - Fed governor Michael Bar suggests caution regarding policy adjustments, a sentiment echoed in recent Fed minutes [1] - Bar expresses skepticism about overlooking higher inflation resulting from tariffs, emphasizing the significant risk to the Fed's price stability goal [1] - The Fed is projected to miss the 2% inflation target for 6 and a half years, potentially until 2027, marking the longest period since 1993 [2] - The Fed acknowledges the possibility of a softening labor market and is prepared for potential deterioration [2] Labor Market & Economic Impact - The labor market is considered more vulnerable to shocks [3] - A Dallas Fed paper indicates a new break-even rate of 30,000 for payroll numbers to maintain a stable unemployment rate [4] - The government shutdown is expected to negatively impact GDP in the short term, with a subsequent rebound [3][4]

If people were expecting the Federal Reserve to give us fireworks, they were sorely disappointed. Fed chief J. Pal is not giving hyperbole.He's trying to balance price stability with job growth. And right now, the risk tilt against the ladder. As Pal told us today, the labor market is really cooling off.So, the widely expected quarter point rate cut made a ton of sense. But the market was all over the place after we got this widely telegraphed news. Dow gaining 260 points, SME dipping.1%, NASDAQ declining.3 ...

Thanks, Chair Powell. Matt Eaggan from CNN. We re we we recently learned that average FICO credit scores are down this year by two points, the most since 2009 during the Great Recession, and delinquencies are high for car loans, personal loans, credit cards.How concerned, if at all, are you about the health of consumer finances. And do you expect today's cut will help. So, you know, we're aware of that.I think this default rates have been um kind of ticking up and we do watch that. Um they're not at a level ...

Monetary Policy & Economic Outlook - The market interpreted Fed Chair Jerome Powell's statements at Jackson Hole as leaning towards concern about the job market outlook [2] - The industry remains agnostic on the relative likelihood and danger of inflation and unemployment, noting the lack of sustained 2% inflation in recent years and potential consequences of tariffs [3] - The industry emphasizes the importance of the Fed being data-dependent, closely monitoring inflation and unemployment statistics due to stagflationary impulses [4] - The industry suggests the biggest medium-term risk is the failure to achieve a sustained return to 2% inflation, potentially eroding the Fed's credibility [10] Trade & Tariffs - The industry acknowledges the upending of global trade under the Trump administration, particularly due to tariffs [6] - The industry anticipates more inflation than would occur without substantial tariffs, while also acknowledging potential deflationary or disinflationary effects [9] Fed Independence & Political Pressure - The industry expresses confidence in J Powell's integrity, even amidst political pressure, and believes his actions are based on conviction [12][13] - The industry views the potential firing of Lisa Cook, Fed Governor, as concerning, highlighting the potential weaponization of regulatory power [15][16][17] Deals-Based Capitalism - The industry is surprised by the government taking a 10% stake in Intel, viewing it as part of a problematic "deals-based capitalism" approach [18][19][20][21]

Monetary Policy - India's central bank has not "lost sight" of its growth objective [1] - Price stability remains the primary mandate of India's central bank [1]

Central Bank Independence - Central bank independence is key to achieving price stability and building the basis for economic growth [1] - Germany's economic miracle after 1948 was attributed to the establishment of an independent central bank with the help of the United States [1] Monetary Policy and Leadership - The speaker acknowledges the importance of Paul's speeches at Jackson Hole [2] - The speaker considers Paul an outstanding and excellent central banker [2] - This year's Jackson Hole meeting is expected to be very important for Paul, as it is his last meeting in his current role [2]

Central Bank Independence & Monetary Policy - Central bank independence is crucial for price stability and economic growth [2][5] - The speaker emphasizes the need to fight for central bank independence, drawing on Germany's post-1948 experience [3][4][5] - The speaker expects Jerome Powell to deliver a clear message on price stability and the central bank's mandate [7] Interest Rate & Inflation - The speaker believes interest rates are currently in equilibrium at 2%, aligning with the target [8][9] - The speaker suggests inflation is potentially no longer the primary concern, but disinflation risks need monitoring [9][10] - Service inflation remains high, above 3%, necessitating a wait-and-see approach to monetary policy [10][11] Economic Outlook - A mild recession in Germany is possible this year, but economic growth is expected to return next year [7][8] - The speaker notes the potential for imported disinflation from a strengthening Euro and cheap Chinese goods [10] - The bar for cutting interest rates is high, requiring significant evidence to warrant a change in monetary policy [12]

We're going to go right now to Jay Powell has become speaking and delivering this speech. >> In my remarks today, I will first address the current economic situation in the near term outlook for monetary policy. I will then turn to the results of our second public review of our monetary policy framework, as captured in the revised Statement on Longer Run Goals and Monetary Policy Strategy that we released today.When I appeared at this podium one year ago, the economy was at an inflection point. Our policy r ...

Monetary Policy Framework - The policy decisions are guided by principles that consider deviations from goals and varying time horizons for achieving the dual mandate of maximum employment and price stability [1] - Monetary policy is forward-looking, considering the time lags in its effects on the economy, thus policy actions depend on the economic outlook and balance of risks [2] - Setting a numerical goal for employment is considered unwise because the maximum level of employment is not directly measurable and changes over time for reasons unrelated to monetary policy [3] - A longer-run inflation rate of 2% is viewed as most consistent with the dual mandate goals, and commitment to this target helps keep longer-term inflation expectations well anchored [3] Inflation Target - Experience has shown that 2% inflation is low enough to ensure that inflation is not a concern in household and business decision-making while also providing a central bank with some policy flexibility to provide accommodation during economic downturns [4] Review Cycle - The consensus statement retained a commitment to conduct a public review roughly every 5 years to reassess structural features of the economy and engage with the public, practitioners, and academics on the performance of the framework [4][5]

Monetary Policy - The Fed is abandoning its 2020 flexible average inflation targeting framework [1] - Stable inflation expectations cannot be taken for granted [1] - Uncertain estimates that employment may exceed its maximum sustainable level do not necessarily warrant policy tightening [1] - Preemptive action may be needed if a tight labor market risks price stability [1] Inflation & Tariffs - The impact of tariffs on consumer prices is now clearly evident [1]