Bernanke Comments
It looks like over the short-term the Fed will be using interest on excess reserves as its primary monetary policy tool to aid in its removal of excess liquidity from the market. This is the interest rates paid to banks on excess reserves held at the Fed. These comments continue to indicate accommodative monetary policy for the foreseeable future, but have set out a blue print on how eventual tightening will likely start to occur.
Other Bernanke Comments That Came Across my wire:
-10:00 02/10 BERNANKE: ECON CONTS NEED ‘SUPPORT OF HIGHLY ACCOM MON POL’
-10:00 02/10 BERNANKE: WILL EVENTUALLY RETURN TO FED FUNDS AS POLICY TARGET
-10:00 02/10 BERNANKE: ‘IN DUE COURSE’ MUST TIGHTEN ‘AS EXPANSION MATURES’
-10:00 02/10 BERNANKE: DON’T EXPECT SEC’TIES SALES TIL TIGHTENING UNDERWAY
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