The Federal Reserve made a splash last week with the release of the FOMC minutes from the central bank’s mid-December monetary policy meeting.
The minutes revealed that despite the dovish developments at the meeting – namely, the introduction of the Evans rule, which ties interest rate guidance to employment and inflation thresholds as opposed to calendar dates – several of the members of the Committee favoured halting quantitative easing sometime in 2013.
While not technically inconsistent, the announcement of the Evans rule and the hawkish tone toward asset purchases in the minutes from the same meeting seem to send the market conflicting signals regarding the Fed’s current thinking: is the Committee dovish regarding future monetary policy, or is it hawkish?
On Friday, in the wake of the confusion brought about by the FOMC minutes, St. Louis Fed President James Bullard brought some clarity to the matter when he hinted in an interview that the Fed might consider halting its bond buying when the unemployment rate fell near 7.1 per cent.
All of this has sparked a buzz among investors, who for the first time in a long while are talking about the Fed potentially removing the monetary stimulus “punchbowl” from the market.
That’s why the next two weeks are so important for Fed watchers attempting to uncover more insight into the Fed’s latest policy communications.
Brean Capital’s Russ Certo noted a flurry of upcoming speeches from Federal Reserve board members that could provide additional clarity for investors.
Below is a full schedule, with details provided by Bloomberg:
- Tuesday, 1/8, 3 PM ET: Richmond Fed President Jeffrey Lacker speaks on the economic outlook at the South Carolina Business & Industry Political Education Committee’s 27th annual meeting. He will speak from prepared remarks and take audience and media questions after.
- Thursday, 1/10, 1:10 PM ET: Kansas City Fed President Esther George speaks on the 2013 Economic Outlook at the Central Exchange. George is expected to take questions from the audience.
- Thursday, 1/10, 2 PM ET: St. Louis Fed President James Bullard will speak about monetary policy and the U.S. economic outlook at the Wisconsin Economic Forecast Luncheon at the Monona Terrace Convention centre in Madison, Wisconsin. Bullard will speak from prepared slides and respond to audience and media questions.
- Thursday, 1/10, 8 PM ET: Minneapolis Fed President Narayana Kocherlakota will speak at a town hall meeting at the Minneapolis Fed.
- Friday, 1/11, 9:30 AM ET: Philadelphia Fed President Charles Plosser speaks on the economic outlook at the New Jersey Economic Leadership Forum. He will speak from a prepared text and take questions form the audience and the media.
- Sunday, 1/13, 8:20 PM ET: Chicago Fed President Charles Evans speaks on an Asian Financial Forum panel on “Asia’s Voice In Global Finance: with officials from China and Australia. The panel will take questions from the audience and Evans will speak to reporters.
- Monday, 1/14, 11:55 AM ET: San Francisco Fed President John Williams will deliver a speech on the economic outlook at the SEMI ISS 2013 Industry Strategy Symposium. Williams will answer questions from the audience if time permits; he will also meet with the press afterwards.
- Monday, 1/14, 12:40 PM ET: Atlanta Fed President Dennis Lockhart will speak to the Rotary Club at Atlanta at the Loudermilk Conference centre. Lockhart will speak about the U.S. economic outlook from a text and take audience questions.
- Monday, 1/14, 4 PM ET: Federal Reserve Chairman Ben Bernanke speaks at the University of Michigan. He will take questions from the audience.
- Tuesday, 1/15, 8 AM ET: Boston Fed President Eric Rosengren speaks on the economic outlook at the Greater Providence Chamber. He will speak from prepared remarks.
- Tuesday, 1/15, 12:30 PM ET: Philadelphia Fed President Charles Plosser speaks on the economic outlook at the 34th Annual Economic Seminar sponsored by the Simon School of Business. He will speak from a prepared text and take questions from the audience and the media afterwards.
- Wednesday, 1/16, 7 PM ET: Dallas Fed President Richard Fisher is delivering a speech titled “Why It’s Important to Downsize Institutions That Are Too Big to Fail” at the National Press Club. Fisher will answer questions from the audience; release of an advance copy of the text and a meeting with the press to be determined.
- Thursday, 1/17, 12:05 PM ET: Atlanta Fed President Dennis Lockhart speaks at the Bloomberg Global Markets Summit.
Pay close attention for additional clues as to what may come next from the Fed.