Fed's Barkin: Not much confidence in any inflation forecast at this point

In an interview with Bloomberg Television, Richmond Federal Reserve Bank President Thomas Barkin said that he doesn't have much confidence in any inflation forecast at this point, per Reuters.

Key takeaways

"Companies want to pass costs on, but consumers are trading down and shopping carefully."

"Inflation is moving in the wrong direction, but so is unemployment."

"Productivity and customer pushback is helping with inflation."

"Expect limited increases in unemployment rate."

"The uncertainty around the economy is starting to lift, but new announcements will be a setback to the sectors that are covered by them."

"Fed is going to have to adjust its stance as it learns more."

"The neutral rate is not that useful as an operational tool in making policy."

"What is more helpful is how the economy is reacting in real time."

"Not sure if Fed will change the policy rate it targets."

"Have to be attentive to how little the fed knows right now about how inflation and unemployment will evolve."

Market reaction

These comments received a hawkish score of 6.2 from FXStreet Fed Speech Tracker. Meanwhile, FXStreet Fed Sentiment Index stays in hawkish territory slightly above 110 after these remarks.

At the time of press, the US Dollar Index was virtually unchanged on the day at 98.44.