More Fed Speak - $, China, Housing & Rates
Richard Fisher, president of the Federal Reserve Bank of Dallas regarding the dollar: "Cheaper inputs help American producers lower their costs." And we know a strong dollar keeps energy and commodity prices down.
On economic growth in China & India: Despite the economic success of both China and India, both countries have a long way to go before surpassing the $12 trillion economy of the U.S. Fisher characterized those who warn that such a thing is imminent as "alarmists."
Fisher points out that, measured in dollars, the economic output of China is about that of California, and India's economy is about 20% less than that of Texas.
Using 3% real U.S. growth, China would have to grow 21% and India 56% in one year "just to match the dollar value of our annual increase in production."
On Housing & Rates:
The one factor that could throw a wrench into any plans to pause rate increases in June is housing.
Donald Kohn, who sits on the board of governors at the Federal Reserve: "We have not yet finished this task."
"The federal funds rate appears still to be below the level that we would expect to be consistent with the maintenance of stable inflation and full employment over the medium run."
"And if growth is sustained and inflation remains contained, we are likely to raise rates further at a measured pace."
"Further Fed changes to interest rates should induce an increase in the personal savings rate, by increasing a return to saving and dampening the upward momentum in housing prices."
On economic growth in China & India: Despite the economic success of both China and India, both countries have a long way to go before surpassing the $12 trillion economy of the U.S. Fisher characterized those who warn that such a thing is imminent as "alarmists."
Fisher points out that, measured in dollars, the economic output of China is about that of California, and India's economy is about 20% less than that of Texas.
Using 3% real U.S. growth, China would have to grow 21% and India 56% in one year "just to match the dollar value of our annual increase in production."
On Housing & Rates:
The one factor that could throw a wrench into any plans to pause rate increases in June is housing.
Donald Kohn, who sits on the board of governors at the Federal Reserve: "We have not yet finished this task."
"The federal funds rate appears still to be below the level that we would expect to be consistent with the maintenance of stable inflation and full employment over the medium run."
"And if growth is sustained and inflation remains contained, we are likely to raise rates further at a measured pace."
"Further Fed changes to interest rates should induce an increase in the personal savings rate, by increasing a return to saving and dampening the upward momentum in housing prices."
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