Fed’s Rosengren says more 2018 hikes may be needed than Fed median shows

Comments from Rosengren in Boston

  • Backs at least 3 more US hikes this year
  • Says he’s more optimistic than already ‘quite positive’ FOMC on forecasts for growth
  • Trade tariffs risk disruption in hard-to-predict ways
  • Q1 jobs growth strong, risk of boom/bust if unemployment drops too low
  • Expects jobless rate to drop to 3.7% by end of 2018
  • Fiscal stimulus could leave economy vulnerable in next downturn

Along with the FOMC minutes, I’m starting to think the market isn’t fully appreciating how eager the Fed is to hike. The problem is that many at the Fed don’t want to invert the yield curve and three hikes would do it.

Rosengren will take audience questions after the speech.

More:

  • Expect Powell to be consistent with Yellen but it’s a bit early to talk about the Powell Fed
  • Momentum could drive unemployment to the low-3s this year
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