The Fed balance sheet increased by $7,419,000,000 in one week!

▪️Waller, Chairman of the Fed:
- Inflation can still be brought back to 2% without raising interest rates, avoiding excessive tightening and a recession.
- I allow for a scenario with roughly equal probability in which the Fed will still need tighter monetary policy.
- I’m not interested in a symbolic rate hike that won’t have a real impact on inflation.

▪️Williams, Chairman of the Fed:
- Inflation remains too high, around 4%, but it has likely already peaked.
- I expect it to fall to about 3.25% by the end of the year, move toward 2% in 2027, and reach the target in 2028.
- Over time, the interest rate will be reduced in line with inflation.