Experts: Therefore Yellens speech so important – Swedish Dagbladet

US central bank chief, Janet Yellen. Photo: Evan Vucci / AP

Are the expectations before Janet Yellens pre haussade speech too high? Or can a single speech to be so important? SvD put the question to the two chief economists.

– The reason that everyone focuses on it so strongly is probably because the market is extremely nervous right now, says Anna Breman chief economist at Swedbank.

Whether US interest rates will be raised or left unchanged is one of the signals that many are waiting for, and where the speech may get a big meanings.

– in the short term it is very important, it will be able to change the pricing and expectations the Fed says Anna Breman, and is backed by SBAB’s chief economist Tor Borg believes that Yellens Propert position of importance.

– which way she leans in terms of interest rates will be important. Several other members of the Fed has spoken out on the issue, so Yellen will be decisive, says Tor Borg.

There are also a long-term perspective that may be affected by the Fed’s stance, which the question is whether we have a new normal level of the policy rate is essential.

– we are in a new historical stage now, where we will have lower growth and lower inflation. If so, then perhaps the normal rate should be lower, and you might need to raise inflation targets, says Tor Borg.

Anna Breman at Swedbank agrees.

– This low interest rate environment that we now raises questions as they will ever be able to raise rates? And how high can you raise? Is there a lower level which is the new normal in the long term? It becomes very important to how you look at interest rate hikes for the rest of the Western world.

Despite the important issues mean two chief economists expectations of the speech is slightly inflated.

– the speech is important, but Yellen will probably not be able to put the foot in any of these issues. In the short term, she can probably not be able to promise something and not deliver as clear signals that are in demand, says Anna Breman.

– The world stands or falls not with what she says in the speech, says Tor Borg.