Charles Evans, president of the Chicago Fed, has made a very strong call for further easing in an interview with the Wall Street Journal. Mr Evans is normally seen as being one of the FOMC’s moderates so this is a strong indicator that the centre of the committee is ready to launch further QE. The following pretty much commits Mr Evans to vote for further QE in November:
“Staring at our forecast, I knew this when we first put out those projections. I knew it was going to be bad. And it is not improving. We’re pushing out the growth prospects. I just think it calls for much more than we’ve put in place. My view on accommodation at the moment is not data dependent. I think we’re there.”
He also implies that he supports a change in communication, possibly along the lines of a more explicit inflation objective:
Is quantitative easing by itself enough without a different communication strategy by the Fed?
Evans: I think that additional asset purchases would have an effect. I think it would be beneficial. I worry that that alone would not be enough to address the particular view that I have.
Chris Giles
Michael Steen
Robin Harding
Ralph Atkins
Claire Jones
