The FED mob is loose this afternoon (European time) with Yellen having a chat with the new administration. The thing we all were worried to death about was whether she would keep her job.
We´re all happy to hear now that Yellen will work side by side with Trump until her course is due…, in about a year. So, one less thing to worry about.
The other issues covered are as follow:
– Wages have gone up but not dramatically
– She can´t say whether a rate hike is coming in March or in June
– Doesn´t want to decide on interest rates based on fiscal policy speculations
Lockhart and Kaplan are also making hawkish comments saying that it would be logical to step off the gas pedal on monetary easing.
This is hawkish stuff, even though they are trying to hide it so the markets don´t build up on expectations. We will explain all these points tomorrow, but with the Buck 50-60 pips higher across the board you get the message.
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