Monetary policy

Federal Reserve Chair Jerome Powell said at the Federal Open Market Committee press conference Wednesday that a slower pace of reduction could help the central bank avoid shrinking its holdings further without disrupting the banking system.

Federal Reserve Chair Jerome Powell last week suggested the central bank is getting close to the confidence it needs to start lowering interest rates.

Jefferson voiced cautious optimism that inflation is headed lower despite a blip in January and said the Fed is likely to begin cutting interest rates later this year.

Federal Reserve Chairman Jerome Powell suggested that a rate cut is coming, but cast doubt about whether the central bank would see enough data suggesting inflation is sufficiently tamed for interest rates to come down at their next meeting.

The president of the Federal Reserve Bank of Dallas and former manager of the central bank's open market account said a slower approach to balance sheet reduction may be warranted sooner rather than later.

Federal Reserve officials point to overnight reverse repurchase agreement activity as an indication of excess liquidity, which the central bank is working to reduce. But some analysts say that excess liquidity may be drying up faster than expected, with important implications for banks.

Benchmark two-year yields, those most closely tied to the outlook for US central-bank policy, rose as much as 14 basis points, the most in a day since June.

Often a harbinger of recessions, the fact that short-term yields are higher than long-term is not inherently bad, Federal Reserve Gov. Chris Waller said Tuesday, noting that in this case it could prove that market expectations are anchored.

Federal Reserve Chair Jerome Powell said he expects the final version of the Basel III endgame reforms to garner "broad support" after comments are received and addressed.

Treasuries fell, extending a selloff in government securities that has rapidly pushed up yields over the past month and threatens to undercut the economy by driving up borrowing costs.

Heinel contends that the Fed is done with its hiking cycle and that policy is restrictive enough. On this basis, she forecasts the U.S. economic growth slowing to 1.1% next year, with the inflation rate moderating to just below 3%.

After the salvo of central bank decisions last week, traders are increasingly concerned that rising oil prices risk fanning inflation, which will make it difficult for policymakers to reduce rates anytime soon.

Analysts look at whether the FOMC will bring the last rate hike in the cycle, whether recession is coming, and whether the Fed is making a policy mistake.

Once it is free to issue new debt, the Treasury Department is expected to quickly replenish its general account at the Fed. The move could lead to a shortage of reserves.

The Federal Reserve Board governor said secular increases to the currency supply limits how much the central bank can shrink its holdings.

The Federal Reserve Chair urged Congress to raise the debt ceiling, warning the impacts of not doing so could go beyond the central bank's ability to mitigate.

Speaking at an event hosted by the Council on Foreign Relations, Federal Reserve Gov. Christopher Waller said the Federal Reserve has a long runway for its balance sheet reduction.

In a speech delivered Thursday afternoon, the Federal Reserve's vice chair said she does not see a wage-price spiral driving inflation, but rather a "price-price spiral."

The Federal Reserve raised its benchmark interest rate by half a percent this week, but chair Jerome Powell said the question now is how long to keep monetary policy tight.

Federal Reserve Chair Jerome Powell said that interest rates could climb less quickly as early as December, but warned that cutting rates "is not something we want to do soon."