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Logan Pours Cold Water On Impact Of Lagged Policy Tightening

  • Dallas Fed’s Logan (’23 voter) says more restrictive policy is needed - “I remain very concerned about whether inflation will return to target in a sustainable and timely way”.
  • Recall that prior to the June meeting she leaned toward not "skipping" but in the end, voted for a hold.
  • Hawkish commentary: “At this point, it is important for the FOMC to follow through on the signal we sent in June. Two-thirds of FOMC participants projected at least two more rate increases this year.”
  • “Some people say a lot of further cooling is in store from lagged consequences of the rate increases the FOMC has already made over the past year and a half. I’m skeptical about the potential for large additional effects from this channel.”
  • “While the final data for the second quarter aren’t in yet, it was clearly pretty hot, too.”… “Moreover, the housing market even looks like it may have bottomed out.”

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