Ahead, Not Behind

This is a syndicated repost courtesy of Alhambra Investments. To view original, click here. Reposted with permission.
Back in September, the FOMC announced that it was in October going to start normalizing its balance sheet. The policy statement issued that day included all the usual qualifications of ‘solid’, ‘strengthen’, and ‘picked up.’ The near-term risks to the economy, it was written, ‘appear roughly balanced.’
Not all was well with the economic situation, however, as the central bank’s policymaking body continues to wrestle with inflation. They might wish for political relief to their dual mandate, but in this case they have no choice but to live with the results – especially since they are largely of their own making. After mentioning economic risks, the statement then throws out there, ‘but the Committee is monitoring inflation developments closely.’

This post was published at Wall Street Examiner on November 3, 2017.