Earlier from Mester here:
More now:
- I don't think 50bps rate hike should be off the table
- I think we will need 50bp hikes at some meetings, based on my forecast
- we really need to get inflation under control
- getting inflation under control is the best thing we can do to make sure healthy labor market continues
- Important to use both of our tools to get inflation on a better trajectory
- balance sheet won't be the main tool to fight inflation but we will do what we need to do to reduce it
- aim is to be nimble and hit goals of full employment, stable prices
- under some dire circumstances, not base case, Ukraine conflict could hit US growth but right now inflation is the bigger concern
- financial markets are supportive of the Fed's getting inflation under control
- in the old days monetary policy wanted to surprise people, these days we are trying to be transparent
- constrained supply and excess demand for labor is pushing inflation up, can't be complacent
I think the key takeaway here is Mester's talk of 50bps at "meetings", plural. So more than one +50 according her forecasts.
