Brainard: "Methodical" Tightening To Include "Significantly" Faster QT

The key extracts from Gov Brainard's speech:

• Given Brainard's dovish credentials, she makes a notable mention of legendary hawk Fed Chair Paul Volcker in the first paragraph...then again, she also mentions Arthur Burns under whose leadership inflation soared.
• On tightening: "It is of paramount importance to get inflation down... accordingly, the Committee will continue tightening monetary policy methodically through a series of interest rate increases and by starting to reduce the balance sheet at a rapid pace as soon as our May meeting."
• On runoff pace: "I expect the balance sheet to shrink considerably more rapidly than in the previous recovery, with significantly larger caps and a much shorter period to phase in the maximum caps compared with 2017-19"
• On runoff impact: "The reduction in the balance sheet will contribute to monetary policy tightening over and above the expected increases in the policy rate reflected in market pricing and the Committee's Summary of Economic Projections."
• On the yield curve: "I am attentive to signals from the yield curve at different horizons and from other data that might suggest increased downside risks to activity."