Fed’s WIlliams; Monetary policy data dependent in highly uncertain environment

NY Fed Pres. Williams is the next speaker and he says:

• Monetary policy is data-dependent in a highly uncertain environment.
• Government policy outlook is the main source of uncertainty.
• Monetary policy is “well-positioned” for the economic outlook.
• Disinflation process to continue but could be choppy.
• Improvement in supply/demand balance allowed rate cuts.
• Balance sheet drawdown proceeding smoothly.
• Expects growth to moderate to 2% this year.
• Expects unemployment rate to hold between 4%–4.25%.
• Sees move to 2% inflation over coming years.
• Housing-related inflation pressures are easing.
• Economy has returned to balance.
• Inflation expectations are anchored

Lots of uncertainty from the voting member.

The expectations for a cut increased today, but the market is still 50/50 (or just below) for a 2nd cut in December

A look at yields:

• 2 year 4.289%, -7.6 basis points
• 5 year 4.470%, -12 basis points
• 10 year 4.669%, -11.9 basis points
• 30 year 4.85%, -9.9 basis points

This article was written by Greg Michalowski at www.forexlive.com.