New York Federal Reserve President John Williams said on Friday he's not worried the economy will overheat due to government overspending, adding that employment and inflation are far below levels that would prompt the U.S. central bank to dial back its own support.
The risks of ongoing business failures in the United States "remain considerable" even as the economy emerges from the coronavirus pandemic, the Federal Reserve said on Friday in its semi-annual monetary policy report to Congress.
A record rush to big technology stocks saw equity funds bagging $27.8 billion inflows last week with the ongoing ultra-easy monetary policy creating the "mother-of-all asset bubbles", BofA said on Friday.
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WASHINGTON (Reuters) - Facing a still-scarred economy that may need an extended time to recover fully, Federal Reserve officials last month debated how to lay the groundwork for the public to accept higher inflation, and also the need to “stay vigilant” for signs of stress in buoyant asset markets, according to minutes of the U.S. central bank’s Jan. 26-27 policy meeting.
FILE PHOTO: The Federal Reserve building is pictured in Washington, DC, U.S., August 22, 2018. REUTERS/Chris Wattie
In discussions that ranged from the public’s perceptions of inflation to the vagaries of Robinhood-type retail stock trading platforms, Fed officials said they were still prepared to keep their easy monetary policy on track to help heal a job market still ailing from the impact of the coronavirus pandemic.
In May 2013, bond investors threw a tantrum after hints the U.S. Federal Reserve might slow the money-printing presses. A similar selloff now, with another $70 trillion added to global debt, could prove to be far more vicious. A 2013-style "taper tantrum" was named as one of the top market risks in BofA's February poll of fund managers who fear a pick-up in inflation expectations might soon persuade central banks to start withdrawing or "tapering" stimulus.