Question From MNI's Evan Ryser On Mon Pol Framework and QT

Q from MNI's Evan Ryser: Is Fed reviewing its monetary policy framework? Given illiquidity/volatility in financial markets, will QT make that worse?

• A: We've looked carefully and hard at why inflation picked up more than expected last year and why it proved so persistent. The context for the framework is that for decades inflation was dominated by disinflationary forces, a flat Phillips curve, with transient supply shocks. Extraordinary shocks - the pandemic, the response, the reopening, war in Ukraine, shutdowns in China. Potentially having effects for years and we're aware that different forces are driving the economy.
• In our thinking inflation is working differently, as a question of strong demand, but you couldn't get that kind of inflation without a change on the supply side. We've done a lot of work internally on that. You don't know whether those forces will be sustained. Will we go back to a world that looks like the old world or not? Honestly we don't know.
• Re QT, we've indicated to the markets what we're going to do there, it seems to be accepted by markets.