23 Feb 2015
Will Yellen still make the case for a mid-2015 liftoff? – DB
FXStreet (Barcelona) - Economist at Deutsche Bank, view that this week’s Yellen’s semiannnual monetary policy testimony will likely be making the case to Congress that the process of policy normalization should begin soon.
Key Quotes
“The main event next week will be Fed Chair Yellen’s semiannual monetary policy testimony before the Senate Banking Committee (Tuesday) and the House Financial Services Committee (Wednesday)."
“We expect Ms. Yellen’s testimony to largely mirror the minutes from the January 27-28 FOMC meeting, which did not indicate any substantive changes to the projections for near-term growth or long-term inflation compared to the Fed’s December forecasts.”
“However, Yellen may sound even more upbeat on the economy in light of the strong January employment report, which showed substantial upward revisions and a sharp bounce-back in wage growth. As such, Yellen may be less dovish than market participants anticipated following the release of this week’s January meeting minutes.”
“If recent Fed-speak is any indication, the Chair will likely be making the case to Congress that the time is approaching for the Fed to begin the process of policy normalization, and if the data continue to support the Fed’s forecast, this could commence around the middle of this year.”
Key Quotes
“The main event next week will be Fed Chair Yellen’s semiannual monetary policy testimony before the Senate Banking Committee (Tuesday) and the House Financial Services Committee (Wednesday)."
“We expect Ms. Yellen’s testimony to largely mirror the minutes from the January 27-28 FOMC meeting, which did not indicate any substantive changes to the projections for near-term growth or long-term inflation compared to the Fed’s December forecasts.”
“However, Yellen may sound even more upbeat on the economy in light of the strong January employment report, which showed substantial upward revisions and a sharp bounce-back in wage growth. As such, Yellen may be less dovish than market participants anticipated following the release of this week’s January meeting minutes.”
“If recent Fed-speak is any indication, the Chair will likely be making the case to Congress that the time is approaching for the Fed to begin the process of policy normalization, and if the data continue to support the Fed’s forecast, this could commence around the middle of this year.”