lael brainard : navigating monetary policy as headwinds shift to tailwinds speech by ms lael brainard, member of the board of governors of the federal reserve system, at the money marketeers of new york university, new york city, 6 march 2018. * * * i am grateful to john roberts of the federal reserve board for his assistance in preparing this text. these remarks represent my own views, which do not necessarily represent those of the federal reserve board or the federal open market committee. i appreciate the invitation from the money marketeers to discuss the path ahead for our economy and monetary policy. many of the forces that acted as headwinds to u. s. growth and weighed on policy in previous years are generating tailwinds currently. today many economies around the world are experiencing synchronized growth, in contrast to the 2015 - 16 period when important foreign economies experienced adverse shocks and anemic demand. the international monetary fund revised up its outlook for the world economy in january, continuing a recent pattern of upward revisions, in contrast to a string of downward revisions in 2015 and 2016. 1 stronger economies abroad should increase demand for america ’ s exports and boost the foreign earnings of u. s. companies. the upward revisions to the foreign economic outlook are also pulling forward expectations of monetary policy tightening abroad and contributing to an appreciation of foreign currencies and increases in u. s. import prices. by contrast, foreign currencies weakened in the earlier period, pushing the dollar higher and u. s. import prices lower. since the end of 2016, a broad index of the exchange value of the dollar has depreciated nearly 8 percent, whereas it appreciated by 25 percent from mid - 2014 to 2016. in recent quarters, the combination of higher oil prices and robust global demand has been providing strong support to business investment — in contrast to the sharp pullback from 2015 to 2016. business spending on fixed investment rose at more than a 6 percent pace in 2017. this rise followed two years of weak growth, dragged down by declines in the drilling and mining sector. financial conditions are currently supportive of economic growth despite the recent choppiness in financial markets and some tightening since the beginning of the year. various measures of equity valuations remain elevated relative to historical norms even after recent movements, and corporate bond spreads remain quite compressed. 2 this compares with the period from mid2014 through the second half of 2016, when equity prices were flat and the dollar rose steeply

##s guide. this is indeed, in line with imf ’ s and mefmi ’ s mandate of imparting hands - on skills. i therefore, expect the course to bring together information on key statistical activities currently undertaken by the statistical organizations in our respective countries and to identify what more can be done to further improve the quality and timely availability of statistics in this area. may i urge you all to make the most out of this rare opportunity so that when you return to your respective institutions, you can take the lead in ensuring that our region benefits fully from this invaluable initiative. this, however, can only be realized through individual commitment, free exchange of ideas, sharing of experiences and a good sense of openmindedness among all participants. it is also my hope that strong networking links will emerge out of this course to foster a longrun exchange of ideas and experiences among professionals in the region. once we have the correct classification of data, then we can open another chapter of how to use it in policy making. this will also inform us on how to target the diaspora to channel investments in specific areas – like diaspora bonds. as i conclude, i appeal to you to take some time out of your densely packed schedule to enjoy the hospitality of nairobi. freely explore the boundless beauty of our country, sample local cuisine and explore the attractive tourism products on offer. it is now my singular honour to declare this course officially open, and i wish you fruitful discussions and a memorable stay in nairobi. i thank you all for your attention. bis central bankers ’ speeches