BOC SAYS DOESN'T NEED TO ALTER PATH OF QT RIGHT NOW

this is a test, please ignore

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Question On Raising Rates Above Core PCE Inflation

FED
  • Q: Is there any reason you think you won't have to raise rates above core PCE inflation?
  • A: I would say there are a range of views - that's the classic Taylor principle view. I think you would look at a more forward looking measure of inflation. But I think the answer is we'll want to get the policy rate to a level where the real interest rate is positive. We will want to do that. I think you put some weight on that and weight across the curves. Very few people borrow at the short end. Households and businesses see meaningfully positive interest rates all across the curve. Credit spreads are larger and borrowing rates are higher. Financial conditions have tightened quite a bit. I would look at that as an important feature. I wouldn't say it's something that is the single dominant thing to look at.
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