Fed's George: Encouraging to see inflation coming down

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Fed's George: Encouraging to see inflation coming down

<ul><li>Encourging to see inflation coming down</li><li>Fed has to be a little more patietn in assesing if inflation on sustainable path</li><li>We continue to see service sector inflation</li><li>Inflation sector pressures set to continue</li><li>I need to see progress on that to have more confidence</li><li>We are in a good place today</li><li>Fed facing a very tight labor market</li><li>ON supply side of labor market, some binding constraints that make it difficult for inflation to come down in a convincing manner</li><li>Need to see job opening come down</li><li>Still a lot of money on household balance sheets</li></ul><p>Fed's George is not a voting member and is set to retire shortly.</p><p>Last night NY Fed Pres. Williams said:</p><ul><li>Inflation is still to high</li><li>The Fed still has more work to do to bring inflation down to their goal of 2%</li><li>Job growth remains strong</li><li>He expects growth to be moderate in 2023</li><li>He is not changing his view on rate forecast. WIll be based on data</li></ul><p>Meanwhile, while the Fed forecasts 5.13% for the terminal rate, the market forecasts the Fed cutting to 4.43% by year end. That is a 71 basis point difference between the Fed target and what the market is currently pricing in.</p><p>Later today Fed's Chris Waller will be speaking at 1 PM.  He is probably the last Fed official to speak before the blackout period before the February 1 meeting.  Waller is thought to be more of a hawk.  Hence his comments will be monitored for a easing of those views.  </p>

                This article was written by Greg Michalowski at www.forexlive.com.

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