In an interview with Financial Times the new chief economist of the Bank of England, Huw Pill, forecast U.K. inflation would go above 5% in 2022, speculating that a rate increase potential at the bank’s next meeting “is live” (the bank’s repo rate is currently 0.1%). The Russian National Bank did increase its discount rate, by a full 0.75% to 7.5%, after increasing its forecast of consumer price inflation for 2021 to the 7.4-7.9% range.
Federal Reserve Chair Jerome Powell, in his speech Oct. 22, said “It’s time to taper, not to raise rates,” and made clear that the Fed’s current “plan” is to stop buying securities completely by July 2022. His denial of the potential for rate increases was met with skepticism. As of the Fed’s balance sheet report of Oct. 21, there was no sign of any tapering. The value of securities it held rose by $85 billion in the week to Oct. 21, and its total balance sheet assets rose to $8.615 trillion.
And Powell and Fed Vice-Chair Richard Clarida may not be around anymore by July 22—see the most recent two entries on Pam and Russ Martens’ blog. https://wallstreetonparade.com/
