Fed Looking For Evidence to Support a Hike: Schmieding

The transcript discusses the Federal Reserve's potential rate hike, focusing on market reactions to hawkish signals, the impact of international events like Brexit, and the Fed's data dependency. It highlights the gap between consumer income and spending, the importance of inflation data, and the Fed's communication strategy. The discussion also covers inflation targets, the concept of overshooting, and the role of the dot plot in economic recovery post-financial crisis.

What is the Federal Reserve's default mode regarding rate hikes?

• To lower rates if nothing intervenes

• To wait for international markets to stabilize

• To maintain current rates indefinitely

• To hike rates if no major issues arise

Which data point is NOT mentioned as important for the Fed's decision-making?

• Inflation rates

• Wage growth

• Consumer spending

• Unemployment rates

Why does the Fed avoid promising actions for the next meeting?

• To focus solely on domestic issues

• To prevent market overreaction

• To keep their options open for international negotiations

• To avoid communication problems if they don't act

What is the Fed's stance on inflation overshooting?

• It is irrelevant to their current policy

• It is a major concern for central bankers

• It is acceptable to make up for past shortfalls

• It is strictly against their mandate

How does the Fed view the dot plot in terms of forecasting?

• As a critical tool for decision-making

• As a mandatory part of their reports

• As an outdated method

• As an interesting but not serious forecast