US Dallas Federal Reserve's Kaplan still up to the mic 7 Feb
- we are likely to overshoot full employment
- significant overshoot likely to create imbalances elsewhere
- once concern over recent tax legislation is that it will lead to higher debt to GDP
- neutral interest rates likely to be lower than historic levels
On Friday Kaplan said he has more conviction on 3 rate hikes than he did 6 months ago but rates should rise gradually and consistently.
I still don't expect the Fed to stick to their promises on rate hikes even with new boy Powell at the helm and if they do then it's to produce some wriggle room for the next crisis. Same applies for BOE.
