January 20, 2023 18:43 GMT
Waller: Real Rates Pretty Close To Sufficiently Restrictive
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Waller on real rates close to sufficiently restrictive:
Paraphrased remarks from Q&A. "Looking at very short-term forecasts out, rates are restrictive. When you get close to 5% rates and inflation is 3-3.5%, you’re talking about real rates of 1.5-2%. Looking forward, market’s view of inflation is looking at 2.5-3% by end of year. A 2% real rate by most models is probably pretty close to sufficiently restrictive."
The headline that Fed policy is pretty close to sufficiently restrictive helps nudge FOMC-dated OIS terminal briefly to 4.89% but still relatively minimal change on the day.
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