Fed's Collins: IT's time for mon pol to be patient and deliberate

<ul><li>Fed should 'allow time' when making monetary policy choices</li><li>Too soon to say inflation sustainably moving back back to target</li><li>Fed must balance lowering inflation against slowing economy too much</li><li>Fed can likely achieve goals without causing notable economic pain</li><li>Still too much job market demand</li><li>Wage growth remains elevated</li><li>Core services inflation moderation has been modest</li><li>Expects economy to slow into end of year</li></ul><p>Collins said now is the time to be patient and deliberate with policy. There's a sense of unanimity at the Fed to hold off on hiking in September but to consider hiking later if inflation stays high. The Nov 1 meeting is showing a 40% chance of a hike.</p><p>Key passage:</p><blockquote>The risk of inflation staying higher for longer must now be weighed against the
risk that an overly restrictive stance of monetary policy will lead to a greater slowdown in
activity than is needed to restore price stability. This context calls for a patient and
careful, but deliberate, approach to policy, allowing time to assess the effects of policy
actions to date, and then acting appropriately. Importantly, patience does not mean
indecision, or a change in the commitment to the 2 percent target, but rather time to
ensure that the economy is on a clear trajectory to achieve price stability.</blockquote>

This article was written by Adam Button at www.forexlive.com.