Fed’s Fischer: Too early to tell for September rate hike

Previous case for September liftoff was pretty strong

Previous case for Sept liftoff wasn’t conclusive

Wouldn’t want to decide now on liftoff

Confidence ‘pretty high’ that inflation will get back to 2%

Some factors affecting inflation are temporary

Still need to watch the impact of yuan depreciation

“We don’t have a whole lot of inflation going on so we don’t have to move immediately”
US close to full employment

US economy “working pretty well”

“We’re getting back to normal and at some point we’ll want to show that”

“I think [markets] could settle fairly quickly”

Signals that China was the trigger for market volatility

Direct affect of China on US is reasonably small

“We’re heading in that direct” (toward hikes), notes importance of next week’s jobs data

Fed has time to wait and see incoming data

Would want to wait awhile after first hike before doing anything else

Hawkish comments from Fischer keep a rate hike on the table for September. The US dollar and stocks starting to feel some heat.

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