Federal Reserve Bank of Cleveland President Beth Hammack speaks before the Money Marketeers of New York University
- Supports ongoing quantitative tightening (QT), a slower drawdown pace will allow longer process
- Fed's balance sheet has shrunk from $9T to $6.8T since QT began in 2022
- Money market liquidity still appears abundant
- Supported Fed’s recent slowdown in balance sheet drawdown
- Some volatility in overnight markets is not a bad thing
- Sees possible cases for return to Fed repos depending on market conditions
- There are costs for keeping Fed’s balance sheet too large
- Supports work to strengthen standing repo facility
- Costs of too-large balance sheet include market risk taking
- Does not comment on economic outlook
Beth Hammack
