Minneapolis Fed President Neel Kashkari said yesterday, “if we see a very strong labor market this fall, the way I’ve been expecting, then I think we could say we probably have made ‘substantial further progress.'”

However, the “wrinkle, now, is Delta”. He added, “if Delta causes the labor market to heal much more slowly, then that’s going cause me to step back”

“It’s so frustrating for all of us that the Delta variant is surging the way that it is,” Kashkari said. “I was cautiously optimistic a month ago that it seemed like we had the light at the end of the tunnel … and could return to normal.”

Fed Governor Christopher Waller said yesterday that his outlook is very much that the economy is “going to recovery”. And, “we will be able to pull back on accommodative monetary policy potentially sooner than others think.”

He repeated his “high hopes” for July and August job numbers, and expected the labor market to recover 85% of pandemic job loss by September. Fed could start to taper asset purchases in October if these two reports show 800k to 1m job growth each.

“My base case is that the inflation we’re seeing is somewhat transitory, that there will be some relief in the fourth quarter of this year on price pressures,” Waller added.

San Francisco Fed President Mary Daly said in a PBS interview, she didn’t expect the Delta variant to “derail recovery” in the US. nevertheless, “it’s already very seriously interrupting the recoveries in the global economy,” which is a “headwind on US growth.

She’s looking for “continued progress in the labor market, continued putting COVID behind us, rising vaccination rates, the things that are so fundamental to us saying that the economy has achieved that metric of substantial further progress.”

Right now, her modal outlook is that “we will achieve that metric later this year or early next”. And, “we will do something on the asset front, asset purchase tapering, by the end of this year or early next.”

Full interview here.

Dallas Fed President Robert Kaplan told Reuters that, “as long as we continue to make progress in July numbers and in August jobs numbers, I think we’d be better off to start adjusting these purchases soon,” referring to the QE program.

He added that tapering over a time frame of “plus or minus” about eight months would help give the Fed ” as much flexibility as possible to be patient and be flexible on the Fed funds rate.”

He emphasized it’s “important to divorce discussion of the Fed funds rate from discussion of our purchases.” His comments on purchases are not intended to suggest I want to take more aggressive action on the Fed funds rate.”

Fed Vice Chair Richard Clarida said in a speech that “we are clearly a ways away from considering raising interest rates and this is certainly not something on the radar screen right now”.

If outlook of inflation and unemployment turn out to be the actual outcomes, the necessary conditions for raising federal funds rate “will have been met by year-end 2022.” If inflation remain well anchored at 2%, commencing policy normalization in 2023 would then be “entirely consistent with our new flexible average inflation targeting framework.”

As for asset purchases, he said FOMC members expected the economy to continue to move toward the standard of “substantial further progress.”

FOMC will asses the progress in coming meetings. He reiterated the pledge that, “we will provide advance notice before making any changes to our purchases.”

Full speech here.