Ex-Fed Kochlakota: Fed shouldn’t hike rates in June
Former Fed board member Kochlakota crossed the wires earlier today, via Reuters, expressing his take on the FOMC decision due to be announced in the American afternoon today.
Key Points:
Inflation data is an opportunity for the Fed to continue to provide stimulus without worrying about excessive amounts of inflation
Let's wait to see sustainable 2% inflation before we embark on tightening
I think the Fed is not putting enough weight on the fact that having more employment in the current environment would be a positive thing
There is an ability to generate more jobs without running into excessive amounts of inflation
There remains room for improvement on the economy. I think the Fed could facilitate a faster rate of improvement
Fed balance sheet should grow with the economy
Normalcy should only be defined in terms of outcomes and not in terms of the setting of the policy instruments
Fed is risking losing some job creation opportunities
Author
Dhwani Mehta
FXStreet
Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.
