Powell 's inflation outlook to be top question
Jerome Powell
At this week's confirmation hearing of  Jerome Powell  for Federal Reserve chairman   his  views on inflation may now be question No. 1.
 Powell  is scheduled to testify on Tuesday before the Senate Banking Committee  and the inflation issue has now become more important after comments last week by current Fed Chair Janet Yellen. She expressed increasing doubts about the inflation outlook  saying she expects it "to move back up over the next year or two" toward the Fed's 2 percent goal.
That raises the question of what  Powell  now believes. A Fed governor for the past five years   Powell  has expressed some concerns about low inflation but hasn't yet gone as far as Yellen. In an Aug. 25 CNBC interview   Powell  called low inflation "kind of a mystery."
Given low unemployment   Powell  said  he  would expect higher readings.  He  added that low inflation numbers give the Fed "the ability to be patient" in raising rates.
That was a small change from  his  more definitive assertion in June that "there are good reasons to expect that inflation will resume its gradual rise."  Powell  does not appear to have spoken on the issue since  his  Aug. 25 CNBC interview.  His  last speech on monetary policy was June 1.
In that speech   Powell  supported the Fed doctrine of symmetry around its inflation objective. That is  Fed members have agreed to be as concerned with inflation that runs persistently above or below its target. For policy  that should mean the Fed would just as soon either not hike or cut rates in the face of low inflation as it would hike if inflation were too high.
 Powell 's views have generally followed Yellen and the consensus  and there's no reason to believe he will challenge current doctrine. But Powell  who is not an economist  hasn't yet had an opportunity to show his own ability to develop doctrines and policies that differ from the consensus. A former private equity banker   Powell  may well be tested on the job if  as appears to be the case now  economic developments defy historical precedent.
If inflation remains low while the unemployment rate continues to fall  it may not be long before  Powell  will have to devise  his  own unconventional policies and doctrines for handling a set of difficult and unconventional economic outcomes.
At this week's confirmation hearing of  [TGT] for Federal Reserve chairman   his  views on inflation may now be question No. 1.
  [TGT] is scheduled to testify on Tuesday before the Senate Banking Committee  and the inflation issue has now become more important after comments last week by current Fed Chair Janet Yellen. She expressed increasing doubts about the inflation outlook  saying she expects it "to move back up over the next year or two" toward the Fed's 2 percent goal.
That raises the question of what   [TGT] now believes. A Fed governor for the past five years   Powell  has expressed some concerns about low inflation but hasn't yet gone as far as Yellen. In an Aug. 25 CNBC interview    [TGT]   called low inflation "kind of a mystery."
Given low unemployment    [TGT] said  he  would expect higher readings.  He  added that low inflation numbers give the Fed "the ability to be patient" in raising rates.
That was a small change from  his  more definitive assertion in June that "there are good reasons to expect that inflation will resume its gradual rise."  Powell  does not appear to have spoken on the issue since  his  Aug. 25 CNBC interview.  His  last speech on monetary policy was June 1.
In that speech    [TGT] supported the Fed doctrine of symmetry around its inflation objective. That is  Fed members have agreed to be as concerned with inflation that runs persistently above or below its target. For policy  that should mean the Fed would just as soon either not hike or cut rates in the face of low inflation as it would hike if inflation were too high.
  [TGT]  's views have generally followed Yellen and the consensus  and there's no reason to believe he will challenge current doctrine. But  [TGT] who is not an economist  hasn't yet had an opportunity to show his own ability to develop doctrines and policies that differ from the consensus. A former private equity banker   Powell  may well be tested on the job if  as appears to be the case now  economic developments defy historical precedent.
If inflation remains low while the unemployment rate continues to fall  it may not be long before  Powell  will have to devise  his  own unconventional policies and doctrines for handling a set of difficult and unconventional economic outcomes.