The longer the Fed chairman waits to detail his thinking, the bigger the risk the central bank will be forced into a disorderly slamming of the policy brakes.
Federal Reserve chairs usually approach the annual confab of central bankers at Jackson Hole, Wyoming, in one of two ways. Either fly under the radar screens of markets, or some eye-grabbing policy announcement.
It would not surprise me if Jay Powell, in his keynote speech this week, opts for the former at this year’s virtual event. Some might even see this as a more risk-averse option. That would be unfortunate. The wellbeing of the economy, the Fed and financial markets call for Powell to take the latter route. It is also the less risky option.
Loading...
Financial Times
Mohamed A. El-Erian, is president of Queens’ College at the University of Cambridge and a professor at the Wharton School of the University of Pennsylvania
