San Francisco Fed President John Williams will speak on the economy at the bottom of the hour with audience and media questions to follow.
Williams is a dove but he hasn’t called for QE3. On May 3/4, he said
- He expects inflation to be in line or “somewhat below” 2% in 2013 and 2014
- Said he would favor QE3 if he saw a “sustained movement away” from the 2% inflation objective
- Expects unemployment around 8%
- If unemployment was “just stuck… over some months” it would raise probability of QE3
- Said policy was “correctly calibrated”
- In Feb, he touted MBS buying so he may go in that direction
I can’t imagine Bernanke or Yellen tilting dovish if Williams doesn’t.