Sinai’s – Husby Economic Market Perspective: Strong Enough, or Too Soft, for A September Fed Rate Hike? Transparency Problems?

Posted September 20, 2016 by rvillareal

Mixed incoming data on the economy and inflation, diverse opinions and expectations by Federal Reserve Members on the economic and labor market outlook, and differing views on the appropriate federal funds rate path forward to maintain full employment and also price stability by the end of next year have thrown confusion and debate into the air on the next move by the Fed and what might lie ahead thereafter.

Rarely has there been so much division of opinion on so many dimensions of monetary policy.  Add to that the other debates on the U.S. economy—recession, stagnation, or doing well; the state of the labor market; and the future path of inflation—makes for a recipe of confusion and volatility in financial markets; indeed, added to by the Federal Reserve itself in its attempt at transparency.