WASHINGTON (MarketWatch) – Federal Reserve Governor Lael Brainard on Friday mentioned the U.S. critical bank must transfer with “higher caution than normal” to regulate interest rates given weak point overseas. In a speech to the world financial Fund, Brainard, a key dove on the U.S. relevant financial institution, stated that additional weakening from in another country could pose a draw back possibility on the U.S. financial outlook. since the Fed’s target interest rate is already set at zero, the flexibility to offset any weakness was limited, she mentioned. Brainard said the “feedback loop” between market expectations of divergence between the U.S. and its main buying and selling partners and monetary tightening in the U.S. implies that “material restraint to U.S. conditions is already in location.”
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