Dallas Fed President Robert Kaplan said yesterday that he expects US to have “solid” growth this year. And, “based on my base-case outlook for the U.S. economy, the current setting of the federal funds rate at 1.5 to 1.75 percent is roughly appropriate.”
Kaplan saw boosts to the economy from ratification of the USMCA, trade deal phase one with China, and clarity over Brexit. And, “these developments, combined with a strong U.S. consumer … should lead to solid growth in 2020.” Though, he added that he will continue to monitor risks, in particular from China’s coronavirus. But, “still too soon to predict with confidence the ultimate impact of this virus on the US and global economies.”
FOMC minutes will be featured today they’re unlikely to deliver any deviation from chair Jerome Powell’s press conference. The minutes will likely repeat the message that policy is in a good place and Fed is in wait-and-see mode, monitoring the effect of last year’s three rate cuts, as well as the play out of global risks.
