The Fed is raising rates while many other central banks are still providing extensive monetary accommodation. With unemployment now at 4.5 percent and inflation slowly rising, many Fed policymakers have been increasingly confident about meeting the central bank's forecast of a further two rate increases this year. "Even if monetary policy divergence remains substantial, there is good reason to think that spillovers to foreign economies will be manageable," Fischer said in prepared remarks to a conference in Washington jointly organised by the International Monetary Fund. "The main reason for the positive market reaction is that foreign output expansions appear more entrenched, and downside risks to those economies noticeably smaller than in recent years," Fischer said. "A gradual and ongoing removal of accommodation seems likely both to maximize the prospects of a continued expansion in the U.S. economy and to mitigate the risk of undesirable spillovers abroad," Fischer said.
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The Fed is expected to continue tightening monetary policy this year while other major central banks hold rates steady or ease policy. "Foreign economies are likely to benefit from the developments that induce" the US to tighten, he said. "There may well even be some chance that foreign economies kick into gear enough that US and foreign business conditions become reasonably well aligned." Federal Reserve Vice-Chairman painted a picture of a brightening global economy that can better manage the spillover of gradual monetary tightening in the US. Fischer added that "most foreign central banks" should be able to respond to US rate hikes with policy actions that lessen the impact on financial conditions in their own economies.
Stay up-to-date on market expectations for rate changes by the U.S. central bank with Investing.com's Fed Rate Monitor Tool:https://www.investing.com/central-banks/fed-rate-monitor Markets have reacted to the data and currently rule out the idea that the next Fed rate hike will arrive in June, according to Investing.com's . Fed fund futures project next rate hike for SeptemberInvesting.com – Markets have pushed back expectations for the next round of policy tightening by the Federal Reserve (Fed) on the back of a string of data pointing to weak growth and inflation. However, market odds for further tightening are not set in stone as recent history shows. Fed officials had to pour on the hawkish rhetoric ahead of the last rate increase in March in order to convince markets to readjust their outlook and prepare for the move.
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collected by :Jack Luxor
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Central banks can handle Fed rate hikes: US Fed VP Fischer
The Fed is expected to continue tightening monetary policy this year while other major central banks hold rates steady or ease policy. "Foreign economies are likely to benefit from the developments that induce" the US to tighten, he said. "There may well even be some chance that foreign economies kick into gear enough that US and foreign business conditions become reasonably well aligned." Federal Reserve Vice-Chairman painted a picture of a brightening global economy that can better manage the spillover of gradual monetary tightening in the US. Fischer added that "most foreign central banks" should be able to respond to US rate hikes with policy actions that lessen the impact on financial conditions in their own economies.
Markets push back expectations for Fed rate hikes on weak data By Investing.com
Stay up-to-date on market expectations for rate changes by the U.S. central bank with Investing.com's Fed Rate Monitor Tool:https://www.investing.com/central-banks/fed-rate-monitor Markets have reacted to the data and currently rule out the idea that the next Fed rate hike will arrive in June, according to Investing.com's . Fed fund futures project next rate hike for SeptemberInvesting.com – Markets have pushed back expectations for the next round of policy tightening by the Federal Reserve (Fed) on the back of a string of data pointing to weak growth and inflation. However, market odds for further tightening are not set in stone as recent history shows. Fed officials had to pour on the hawkish rhetoric ahead of the last rate increase in March in order to convince markets to readjust their outlook and prepare for the move.
read more visit us Markets
collected by :Jack Luxor
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