From BS:
Federal Reserve Bank of New York President William Dudley said he continues to believe officials will be able to end their current near-zero interest rate policy before the close of 2015.
“My expectation is that we will probably raise rates later this year,” and any meeting over the remainder of the year is eligible for action, Mr Dudley said. But whatever the Fed does will be driven by how the economy performs and is being affected by financial conditions and overseas events, he said.
Forget it then. The US is on the threshold of manufacturing contraction as the shale implosion and high dollar weigh heavily, from Calculated Risk:
And the Fed’s favoured inflation gauge continues to fall. Core PCE was out last night and was up only 1.3% year on year in an ongoing falling trend:
As commodity input prices keep plunging, the hope of a return to 2% looks pretty forlorn. I mean, really, if for a moment you looked at this chart in isolation and assumed that the Fed’s primary goal was to keep inflation at 2%, would you conclude that a rate hike or QE4 was imminent?
