The balance sheet runoff could be worth two or three additional rate hikes through its entire course, Fed Vice Chair Lael Brainard said on Tuesday according to Reuters. The balance sheet will play an important role in the removal of monetary policy accommodation, she noted, but estimates as to exactly how much are uncertain.
"I would not hang my hat on any particular number, but the reduction in the balance sheet will contribute to tightening."
The health of US economy bodes well for bringing inflation down without causing recession.
"I remain attentive to the shape of the yield curve."
"I think there are different parts of the yield curve that are information and the forward part really doesn't signal anything of concern."
"The later part of the yield curve is what I am watching very carefully."
"I am also watching inflation expectations and economic activity as I judge the pace of removal of accommodation."
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