US inflation expectations remain well anchored – FOMC’s W.Dudley

At his speech today, New York Fed President William Dudley (permanent voter) has argued that economies overseas are growing faster on average than the US economy, while he reiterated that US inflation expectations remain well anchored despite consumer prices running below target.

Dudley also said that the Fed can be gentle when comes to removing policy accommodation, adding that discouraged workers keep re-entering the market and prompting the Fed to wait longer before hiking.

Furthermore, he also noted that the current expansion has still plenty of room to run. Back to normalizing policy, Dudley argued that strong growth and sustainable recovery should pave the way for the Fed to normalize.