Powell from his interview with Marketplace radio
- We've seen wages move up 'a little bit more' in the past year
- Productivity has been very low
- There is still a bit of a puzzle in that we're hearing about labor shortages now all over the country in many, many different occupations in different geographies. And one would have expected, I would have expected, that wages would move up a little bit more
- "We don't really have an answer" to why wages haven't been rising faster
- I think we're starting to see higher wages
- I think the economy's in a really good place
- Phillips curve relationship "is not very strong at all now"
- Inflation has very gradually moved up and it's now just touching 2 percent. So we're really close to our target
- I'm pleased with the results of gradual hiking so far
- We are hearing a rising level of concern about the effects of changes in trade policy
- Trade is very difficult to predict how it turns out and we'll just have to see
- "The fiscal changes that were made at the end of last year and earlier this year, the tax reform, the tax cuts and the spending increases are very likely in our view, and in my view, to support economic activity here in the United States for at least the next few years."
- Longer term, it is widely understood that the United States is on an unsustainable fiscal path
- I sleep pretty well on the economy right now
- Full transcript
After reading the interview, Powell is optimistic overall. Possibly more optimistic than he's been at any time as Fed chair or as Fed governor. Naturally, he's worried about trade but he's not overly worried and I could easily see him hiking twice more this year.
That said, he's watching inflation closely and expects a pickup. If that doesn't materialize then you could see him slow down.
On net, this will continue to keep the wind in the US dollar's sail.
