More from Fed’s Musalem: Baseline is inflation will take longer to come down
- Baseline Outlook is that inflation will take longer to come back down to target.
- Sees risk that inflation may not converge to target as we would like.
- There is a scenario where economy might require a rate increase.
- If we don’t see disinflation in the next one – two quarters that would concern me.
- Hi inflation expectations would also concern me.
- There is also a scenario that in second half of year we could see growth slow down.
- If that were to happen inflation falls, could envision rate cut.
- Right now risks tilted more to inflation side.
Everything is in play with inflation still the concern.
This article was written by Greg Michalowski at investinglive.com.