MNI TRANSCRIPT: Powell: Repo Not Needed for More Reserves

     WASHINGTON (MNI) - The following is the portion of a transcript from

Federal Reserve Chairman Jerome Powell's press conference after the FOMC meeting

Wednesday:

     Q: The combination of purchases and repo operations are described liquidity

and I wonder if you similar an particularly agree with that and what has it been

on risk assets? Do you know if that is something that the board or reserve banks

are looking into or looking at what the effect has been and how are you kind of

thinking about that going forward?

     A: Well, so two questions. In terms of liquidity, I think what we're doing

is what I said. We're trying to raise the level of reserves back up to a level

so banks can meet reserve requirements and that there is enough reserves in the

system that we don't see reserve scarcity and we don't have to use repo

operations to provide additional reserves, so I think as I mentioned, we believe

that we can get to that state at the current pace some time in the second

quarter. In items of effects on risk assets, as I said earlier, it's very hard

to say what is affecting financial markets with any precision or confidence at a

given time. It's not our intention to change the response of monetary policy.

These were designed to provide more reserves and really to do that in order to

enable better transmission of our rate decisions into the economy under our

chosen framework. That's really the purpose of what we're doing.

--MNI Washington Bureau; +86 (10) 8532-5998; email: ryan.hauser@marketnews.com

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