Powell Excerpt: End To "Accommodative" Is "Certainly Coming"

     WASHINGTON (MNI) - The following is a response of Federal Reserve Chairman

Jerome Powell to a question from a reporter at his press conference following

Wednesday's Federal Open Market Committee meeting.

Question: Have you talked during the meeting about when the fed is going to

remove or change the word "accommodative" that described the monetary policy for

almost ten years? And could this change in the vocabulary make the market

nervous? And have you thought already of some options to know how you're going

to call it down the road?

Powell: Yes, that is something that we discuss. We look at all the language. As

you know, we made a significant number of changes at this meeting. So language

gets in the statement, and then, you know, the economy changes. That's what

happens. We really -- our approach to policy hasn't changed, and, you know, as I

mentioned earlier, for a long time the economy has needed to accommodate the

monetary policy. As the economy recovered, we will be at a place relatively soon

when, again, assuming we stay on this path, when interest rates will be in the

zone of what FOMC participants think is roughly neutral, and at that point, it

would no longer be accurate for us to say that the committee thinks that policy

is accommodative. We know that's coming. We kind of don't think it's here yet,

but it's certainly coming, and I think the market will understand that. I mean,

the real message is that you're getting close to the neutral rate. It's a

characterization about where policy is, it's not a statement, really, that

should upset the markets, but, you know, we'll obviously discuss it carefully in

meetings and communicate about it.

--MNI Washington Bureau; +1 202-371-2121; email: holly.stokes@marketnews.com

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