Free Trial

MNI BRIEF: Fed Needs To Consider QE Agility In Review - Daly

Fed's Daly speaks on Fed framework review in Q&A.

MNI (WASHINGTON) - Recent experience with balance sheet policy suggests that the Fed may want to consider in its upcoming framework review how its policy rate, forward guidance, and quantitative easing are linked, San Francisco Fed President Mary Daly said Tuesday. 

"I personally felt like we were too tied up between balance sheet policy and being able to raise the interest rate," she said about events earlier during the pandemic when the central bank first started raising interest rates. "In November of 2021 we signaled that we were going to start tapering our purchases faster, but ultimately might have wanted to start raising rates earlier than in March. Now, a lot of that was done just through communication, but there was a sense where we couldn't do that as long as we were tapering purchases."

Keep reading...Show less
239 words

To read the full story

Close

Why MNI

MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.

MNI (WASHINGTON) - Recent experience with balance sheet policy suggests that the Fed may want to consider in its upcoming framework review how its policy rate, forward guidance, and quantitative easing are linked, San Francisco Fed President Mary Daly said Tuesday. 

"I personally felt like we were too tied up between balance sheet policy and being able to raise the interest rate," she said about events earlier during the pandemic when the central bank first started raising interest rates. "In November of 2021 we signaled that we were going to start tapering our purchases faster, but ultimately might have wanted to start raising rates earlier than in March. Now, a lot of that was done just through communication, but there was a sense where we couldn't do that as long as we were tapering purchases."

Keep reading...Show less