FRB St. Louis President Poole (voter) says inflation expectations are well anchored but the Fed stands ready to raise rates if need be. As if to allay fears of an impending move, Poole says the Fed is in no hurry to respond to incoming data that show the economy returning to potential.
He says there is notimetable to return the core PCE price index to within the comfort level. Thereis no official inflation target, but the implicit upper band is 2% on the core PCE deflator.
Earlier today, Poole was upbeat on the economy's "firmer tone." Fed funds futures are little changed on the session with no change given by any contract before July. The biggest odds for a 25 bps rate cut are given by the October contract, last giving an implied probability of 34%.
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