Feds Evans: Really nervous, inflation expectations are really low

Speaking on Bloomberg

  • At the beginning of the call on December hike
  • Need to see substantial progress on inflation
  • Economy strong enough in the US
  • Inflation disappointing
  • Low inflation is a global environment
  • Clamping may be less constructive if the price of the target value
  • Important 2% inflation as fast as possible
  • The economy has dealt tightens until now
  • WE are close to full employment
  • We should be ready to push inflation above 2%
  • The Fed should not be afraid of a 2.5% inflation
  • The tire pressure should go up if the job market is very strong
  • We don’t know how big the balance sheet is to be once standardized
  • Need to be careful that there is no excessive exuberence
  • The financial stability of a moderate risk for the moment.

The focus on Evan’s comments are more dovish. He is obviously concerned about inflation (or its absence) and wants to see the «whites of inflation’s eyes’ before doing too much clamping. He is undecided on December at the time.
Evans is the president of the Chicago Fed and a voting member in 2017. It will not be a voting member in 2018.
US 10 year yield was lower by -2.5 bps now to 2.335%. The low performance achieved 2.3302% today.

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