Fed’s Kaplan: 3 US rate hikes this year 'reasonable' baseline case
|Reuters reporting headlines from Dallas Fed President Robert Kaplan, commenting on the Fed’s interest rates outlook for this year.
Key Points:
US well-served by March interest rate hike
3 US rate hikes this year 'reasonable' baseline case
Fed is still accommodative, as is appropriate
Removing accommodation should be done gradually, patiently
Sees 'a bit further to go' on rate hikes before it's time to allow fed's balance sheet to shrink
Wants to manage balance sheet run off to avoid unduly affecting financial markets
Fed should trim balance sheet gradually
Fed should keep reduction of portfolio at 'manageable' percent of daily volume in treasuries, MBS
Watching how Obamacare repeal unfolds, could impact consumers' willingness to spend
Could have brief periods where inflation runs above fed's 2-percent goal
Nothing in Fed statement that was intended to convey new information on inflation
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