A summary of the Fed Chair Q&A comments by topic

<p>Employment/Labor Market:</p><ul><li>Labor market remains tight.</li><li>Labor supply and demand are moving towards a better balance.</li><li>Labor demand still exceeds supply.</li><li>Expects labor market rebalancing to continue, easing upward pressure on inflation.</li><li>Stronger economic activity is the main reason for needing to do more with rates.</li><li>It's good we've seen meaningful rebalancing in the labor market without much increase in unemployment.</li><li>Some softening in the labor market is anticipated.</li><li>Soft landing in the labor market is not guaranteed.</li></ul><p>Interest Rates:</p><ul><li>Current policy stance is restrictive.</li><li>The Fed is prepared to raise rates further if appropriate.</li><li>Rates will remain restrictive until inflation is moving down to 2%.</li><li>Real interest rates are meaningfully positive.</li><li>Decision on future rate cuts will be based on the economy's needs.</li></ul><p>Inflation:</p><ul><li>Inflation remains well above the 2% long-run goal.</li><li>Strong commitment to return inflation to 2%.</li><li>Reducing inflation may require below-trend growth and some softening of labor conditions.</li><li>Longer-term inflation expectations seem well anchored.</li><li>Three recent inflation readings have been positive, but more data is needed.</li></ul><p>GDP/Economic Activity:</p><ul><li>Growth in real GDP has exceeded expectations.</li><li>Consumer spending has been a significant driver of GDP.</li><li>The economy has significant momentum.</li><li>Risks to the economy include strikes, government shutdowns, and higher long-term rates.</li><li>GDP growth stronger than expected might require higher interest rates.</li></ul><p>Other Comments:</p><ul><li>The Fed is focused on its dual mandate.</li><li>Decisions will be based on data and risk assessments.</li><li>The Federal Reserve will make decisions on a meeting-by-meeting basis.</li><li>The goal is to restore price stability for maximum growth potential.</li><li>Energy prices, especially if sustained at high levels, can impact inflation and spending.</li><li>The primary concern is restoring price stability.</li><li>Households are generally in good shape due to a strong labor market and rising wages.</li></ul>

This article was written by Greg Michalowski at www.forexlive.com.