After Fed Hawkish Views Spotlight Turns to Yellen on Tuesday

In interviews over the Easter weekend, Federal Reserve officials continued to sound optimistic about a rate hike happening in the next few meetings, but a speech by Fed Chair Janet Yellen Tuesday will give markets the best view yet of just how likely a rate hike is.

St. Louis Fed President James Bullard, in an interview with the Japanese newspaper the Nikkei, said “the April meeting and the June meeting are definitely live meetings, and the committee could move at those meetings, but we’ll see what the data looks like at that point.”

Bullard, a voter this year on the policymaking Federal Open Market Committee, repeated sentiments he expressed Thursday in a speech to the New York Association for Business Economics.

“The next rate increase may not be far off provided that the economy evolves as expected,” he said last week, though he told reporters after the speech, “I wouldn’t want to prejudge the meeting,” adding “there’s not a lot of information that’s going to come in April relative to March.”

Policymakers did get another look at inflation Monday morning with both the headline and core February personal consumption expenditures price indexes coming in at 0.1% for the month.

Core PCE inflation, the Fed’s preferred measure of inflation registered a 1.7% gain from a year ago, not far from the Fed’s 2% target.

Meanwhile, San Francisco Fed President John Williams said in an interview with CNBC Asia before the new inflation data came out. “We’ve been missing our 2% inflation goal for three and a half years or so, global disinflationary factors are still holding inflation down,” he said.

via MNI News

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza