Oct 15 2016

Rate Range Projection by Bank

Next week 103.00 –105.00

Next 3 months 96 - 105.00

The below is a topic from market news

The Federal Reserve may need to run a "high-pressure economy" to reverse damage from the crisis that depressed output, sidelined workers and risks becoming a permanent scar, Fed Chair Janet Yellen said on Friday in a broad review of where the recovery may still fall short

Though not addressing interest rates or immediate policy concerns directly, Yellen laid out the deepening concern at the Fed that U.S. economic potential is slipping and may need aggressive steps to rebuild it

Yellen, in a lunch address to a conference of policymakers and top academics, said the question was whether that damage can be undone "by temporarily running a 'high-pressure economy,' with robust aggregate demand and a tight labor market

One can certainly identify plausible ways in which this might occur

Looking for policies that would lower unemployment further and boost consumption, even at the risk of higher inflation, could convince businesses to invest, improve confidence, and bring even more workers into the economy

Yellen's comments, while posed as questions that need more research, still add an important voice to an intensifying debate within the Fed over whether the economy is close enough to normal to need steady rate increases, or whether it remains subpar and scarred - a theory pressed by Harvard economist Lawrence Summers among others

U.S. stocks posted further gains after Yellen's remarks while the dollar dropped. Treasury bond prices rose, pushing yields on the 2-year note to session lows

Maybe she is preparing for a December rate hike but she doesn't want the market to run ahead of her," said David Keeble, global head of interest rate strategy at Credit Agricole Corporate & Investment Bank. "She has moved the goal post an inch or two...She doesn’t mind more inflation