HALISTER1: X-S&PGR Revises Outlook On Three Panamanian Banks To Negative

X-S&PGR Revises Outlook On Three Panamanian Banks To Negative

Alert: HALISTER1
Source: SPC (Standard & Poor's CreditWire)

Tickers
1355101D US (BAC International Corp)
BGFG PP (BG Financial Group SA)
BLX US (Banco Latinoamericano de Comercio Exterior SA)
3344634Z PP (Republic of Panama)

People
Arturo Sanchez (United Mexican States)
Ricardo Grisi (Standard & Poor's)

Topics
FI Issuer Research

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UUID: 7947283

HALISTER1: Fed Learning That Overshooting 2% Inflation Is Prudent: BofAML

Fed Learning That Overshooting 2% Inflation Is Prudent: BofAML

(Bloomberg) -- Yellen’s Oct. 14 comments on “high pressure economy” represent another reason to overshoot inflation target, BofAML economist Ethan Harris writes in note Friday.
  • NOTE: In Oct. 14 speech, Yellen said there are “plausible ways” that running economy hot could fix damage caused by last recession
  • Fed “slowly figuring out” that overshooting its target is prudent policy
  • “In our view, the U.S. labor market is suffering from hysteresis,” which could be partly reversible
  • In response to question about whether Fed should “experiment” and see if “high pressure economy” reverses some of hysteresis, “our answer is simple: why not?”
    • Overshooting when economy is “hot” ensures inflation averages 2% going forward while reducing risk of tightening too soon and hitting lower bound
  • Weak economy probably did some structural damage; extending the cycle could undo some of that damage
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

People
Ethan Harris (Bank of America Corp)
Janet Yellen (Federal Reserve System)

Topics
BGOV Finance

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UUID: 7947283