Current policy is in a good place to respond to ongoing shocks': Fed’s Barkin projects confidence

Bank of Richmond Federal Reserve (Fed) President Thomas Barkin said on Thursday that "current monetary policy is in a good place to respond to ongoing shocks." Speaking about the US economic outlook and monetary policy, Barkin added that future rate decisions will depend on how businesses and consumers react to developing conditions.

Key quotes:

Current policy is in a good place to respond to ongoing shocks.

Whether the Fed needs to hike rates depends on how businesses, consumers react to developing conditions.

Consumers are not happy but continue to spend.

Businesses are so far managing productivity improvements through attrition and not layoffs.

Policy of looking through supply shocks has worked well in the past, but it is easy to see more challenging conditions and more frequent shocks in the future.

So far long-term inflation expectations appear to remain contained.”