Fed's Bostic: Not sure yet how sanctions on Russia will impact economy
|Dr. Raphael W. Bostic who is the chief executive officer of the Federal Reserve Bank of Atlanta is currently speaking and has said that the US economy is "still quite strong" as officials try to figure out the economy "in real time".
Bostic said companies and output remain constrained by the inability to find workers but when it comes to demand and spending, "people are ready to go".
Key comments
No clear evidence demand will fall off in the coming months; growth is expected to continue.
Modal outlook is not for the recession, but "eventually there will be some slowdown" in growth.
Not sure yet how sanctions on Russia will impact the economy.
Uncertainty could lead to some retrenchment of investment.
Fed is going to "let the data guide us" in upcoming decisions.
Fed needs to move off of emergency policy stance and can do so without jeopardizing employment.
Businesses feel need to adjust wages, but not clear that will persist.
Have not seen worrisome changes yet in long-term inflation expectations.
Market implications
There has been no reaction in the US dollar to the comments. However, Fed tightening expectations have fallen a bit which has been weighing:
With that being said, the US economic data remain strong and the Fed is still on track to tighten aggressively this year.
''If and when some sort of diplomatic solution to Ukraine is eventually reached, US yields should continue their upward trend and help pull the dollar higher as well,'' analysts at Brown Brothers Harriman argued. On the other hand, even if tensions were to intensify this week, the analysts added that ''risk-off sentiment should also boost the dollar due to the so-called dollar smile.'
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.