Select Language

Fed's Goolsbee: Bringing inflation back to 2% takes time

blockHeadVisual
  1. HOME
  2. Get information
  3. World FX news
  4. Fed's Goolsbee: Bringing inflation back to 2% takes time

World FX news

search
Breaking news

Fed's Goolsbee: Bringing inflation back to 2% takes time

  • X
  • facebook
  • LINE
  • RSS
  • X
  • facebook
  • LINE
  • RSS
New update 2024.07.04 09:18
Fed's Goolsbee: Bringing inflation back to 2% takes time

update 2024.07.04 09:18

Federal Reserve Bank of Chicago President Austan Goolsbee on Thursday discussed the economic outlook on BBC Radio. Goolsbee said that getting inflation back to 2% will take time and there is still much data to be had on the economy. 

Key quotes

Bringing inflation back to 2% takes time.

Warns against prolonged high interest rates.

The economy still requires more information. 

Market reaction 

The US Dollar Index (DXY) is trading 0.05% lower on the day at 105.30, as of writing.

Fed FAQs

Monetary policy in the US is shaped by the Federal Reserve (Fed). The Fed has two mandates: to achieve price stability and foster full employment. Its primary tool to achieve these goals is by adjusting interest rates. When prices are rising too quickly and inflation is above the Fed's 2% target, it raises interest rates, increasing borrowing costs throughout the economy. This results in a stronger US Dollar (USD) as it makes the US a more attractive place for international investors to park their money. When inflation falls below 2% or the Unemployment Rate is too high, the Fed may lower interest rates to encourage borrowing, which weighs on the Greenback.

The Federal Reserve (Fed) holds eight policy meetings a year, where the Federal Open Market Committee (FOMC) assesses economic conditions and makes monetary policy decisions. The FOMC is attended by twelve Fed officials - the seven members of the Board of Governors, the president of the Federal Reserve Bank of New York, and four of the remaining eleven regional Reserve Bank presidents, who serve one-year terms on a rotating basis.

In extreme situations, the Federal Reserve may resort to a policy named Quantitative Easing (QE). QE is the process by which the Fed substantially increases the flow of credit in a stuck financial system. It is a non-standard policy measure used during crises or when inflation is extremely low. It was the Fed's weapon of choice during the Great Financial Crisis in 2008. It involves the Fed printing more Dollars and using them to buy high grade bonds from financial institutions. QE usually weakens the US Dollar.

Quantitative tightening (QT) is the reverse process of QE, whereby the Federal Reserve stops buying bonds from financial institutions and does not reinvest the principal from the bonds it holds maturing, to purchase new bonds. It is usually positive for the value of the US Dollar.

 

Date

Created

 : 2024.07.04

Update

Last updated

 : 2024.07.04

Related articles

Show more

Writer

FXStreet

Financial media

arrow
FXStreet

FXStreet is a forex information website, delivering market analysis and news articles 24/7.
It features a number of articles contributed by well-known analysts, in addition to the ones by its editorial team.
Founded in 2000 by Francesc Riverola, a Spanish economist, it has grown to become a world-renowned information website.

Was this article helpful?
No loading Yes loading

We hope you find this article useful. Any comments or suggestions will be greatly appreciated.  
We are also looking for writers with extensive experience in forex and crypto to join us.

please contact us at [email protected].

Thank you for your feedback.
Thank you for your feedback.

Previous article

prev

USD/CHF weakens below 0.9050 ahead of Swiss CPI data

Next article

NZD/USD attracts some buyers above 0.6100 amid the US Dollar weakness

prev

Most viewed

NZD/USD Price Analysis: Bulls gaining control, closes week above critical resistance

On Friday, the NZD/USD saw gains of 0.40% to 0.6050, as it managed to close above the 20, 100, and 200-day Simple Moving Averages (SMA).
New
update2024.07.06 06:43

EUR/USD churns but finds fresh Friday highs after US NFP sparks rate cut hopes

EUR/USD whipsawed after a mixed US Nonfarm Payrolls (NFP) print on Friday before settling on the high side, tapping in a peak bid near 1.3840 just ahead of the trading week's close.
New
update2024.07.06 06:38

GBP/USD continues win streak, extends rally post-NFP

GBP/USD climbed above 1.2800 after US NFP figures sparked risk rally.
New
update2024.07.06 06:22

AUD/JPY Price Analysis:Bulls Pause, pair remains steady above 108.00

In the trading session of Friday, the AUD/JPY pair curtailed its recent bullish momentum but managed to close the week around 108.50 level.
New
update2024.07.06 06:11

Silver Price Analysis: XAG/USD skyrockets above $31.00, eyes further gains

Silver soared above the June 20 high of $30.78 on Friday and extended its gains past the $31.00 figure following a weak US jobs report that lifted expectations about a possible Fed interest rate cut.
New
update2024.07.06 06:09

USD/CHF losses further ground following rise in US Unemployment

In Friday's session, the USD/CHF pair softly sailed, with markets dumping further the USD following the release of mixed labor market data in the US.
New
update2024.07.06 05:00

USD/JPY Price Analysis: Tumbles below 161.00 on back-to-back bearish days

The USD/JPY extended its losses to two consecutive days on Friday, as the US economy showed signs of weakness in the labor market, following a mixed US Nonfarm Payrolls report.
New
update2024.07.06 04:56

Gold price soars after weak US NFP data, higher rate cut bets

The Gold price rallied during the mid-North American session following the release of June's US Nonfarm Payrolls (NFP) report, which exceeded forecasts, but two previous months' downward revisions hinted that the labor market is cooling faster than the figures show.
New
update2024.07.06 04:10

Dow Jones Industrial Average struggles to find direction on Friday after NFP corkscrew

The Dow Jones Industrial Average (DJIA) whipsawed on Friday, churning around 39,300.00 after US Nonfarm Payrolls (NFP) gave markets just enough wiggle room to reignite rate cut hopes.
New
update2024.07.06 04:02

Australian Dollar following mixed US Nonfarm Payrolls figures

The Australian Dollar (AUD) holds its ground against the USD on Friday, which weakened following soft US Nonfarm Payrolls (NFP) figures but stands at its highest level since early January at 0.6740.
New
update2024.07.06 03:23

Disclaimer:arw

All information and content provided on this website is provided for informational purposes only and is not intended to solicit any investment. Although all efforts are made in order to ensure that the information is correct, no guarantee is provided for the accuracy of any content on this website. Any decision made shall be the responsibility of the investor and Myforex does not take any responsibility whatsoever regarding the use of any information provided herein.

The content provided on this website belongs to Myforex and, where stated, the relevant licensors. All rights are reserved by Myforex and the relevant licensors, and no content of this website, whether in full or in part, shall be copied or displayed elsewhere without the explicit written permission of the relevant copyright holder. If you wish to use any part of the content provided on this website, please ensure that you contact Myforex.

arw
  • Facebook
  • Twitter
  • LINE

Myforex uses cookies to improve the convenience and functionality of this website. This website may include cookies not only by us but also by third parties (advertisers, log analysts, etc.) for the purpose of tracking the activities of users. Cookie policy

I agree
share
Share
Line

Line
Facebook

Facebook
X

Twitter
Cancel