- Q: "Systemic risk" was invoked to protect uninsured depositors at those two banks, why?
- A: The issue wasn't about those specific banks but about the risk of contagion to other banks and financial markets.
- Q: In February's presser you mentioned the word "disinflation" 9 or 10 times, is that still occurring today?
- A: I got that question 12 times. Absolutely the story is intact. It's really three parts - goods inflation has been coming down for 6 months though more slowly than we would have liked; housing services is really a matter of time passing; so that's 44% of core PCE.
- What we don't have now is progress in non-housing services sector, which is something that will have to come through softening demand and perhaps in labor market conditions. I will say the inflation data we got really pointed to stronger inflation.
- It's guesswork how significant and sustained this credit tightening will be. We think it's potentially quite real. And that argues for being alert as we think about further rate hikes.
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