Bernanke Leaves Little New Information
According to Deutsche Bank’s Global Markets Research by Joseph LaVorgna, Ben Bernanke provided little information about the Federal Reserve’s future course of action and possible monetary policy tools in today’s testimony before the Congress. However, they suggested that Bernanke might provide some indications in tomorrow’s Q&A.
Bernanke provided no indication that the Fed is leaning toward significant additional quantitative easing measures to be announced at the next FOMC date on August 1. Policymakers are clearly concerned about heightened risks from Europe and recent weakness in the domestic economy (including slow employment gains), but additional action does not appear imminent.
The report also points out that the only stance the Fed might take in the near future would be the extension of the fed funds guidance from end of 2014 to mid-to-late 2015.
Even if such a measure is taken, we do not expect it to have a meaningful economic impact. The Q&A may contain clues about potential additional tools at policymakers’ disposal.
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