Fed’s Daly: If bond yields are tight, that could be the equivalent of another rate hike

“If bond yields are tight, that could be the equivalent of another rate hike,” Federal Reserve (Fed) Bank of San Francisco President Mary Daly said in her scheduled speech late Tuesday, bolstering bets of a Fed pause.

Additional comments

Decline in goods inflation has been an easy win, and not largely due to the Fed's rate hikes.

Just starting to see improvement in non-housing services inflation, need more of it

We have more work to do, inflation is still high.

Fed policy is helping supply and demand get into a better balance.

In future could see the nominal neutral rate go to 2.5%-3%.

The new normal may be a little different, but probably won't be a gigantic reset.

I don't manage markets, I watch them for information.

The risks to the economy are more balanced.

We need to get inflation down to fully balance the economy.

Market reaction

In response to the above comments, the US Dollar kept its downside consolidation mode intact near 105.75, where it now wavers. The US Dollar Index is down 0.06% on the day, at the time of writing.