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Top Fed official backs new chair’s rethink of investor communications

Fed official Waller supports a shift in how the central bank communicates with investors, emphasizing the need for flexibility in forward guidance.

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14950Jul 6 22:29Jul 6 23:29 UTC

The brief

Federal Reserve official Waller is backing the new chair's effort to rethink investor communications. Waller describes the practice of forward guidance as being more art than science and argues that it must remain flexible.

Coverage from Bloomberg, the Financial Times, and American Banker emphasizes Waller's support for this communication shift. Barron's notes that Waller's defense of forward guidance stands in contrast to the views of Warsh.

Future developments center on the implementation of this communication rethink and how the Fed manages guidance, with Waller specifically citing Fall 2021 guidance as a point of reference.

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Quick answers

What is Waller's view on forward guidance?

Waller believes forward guidance is 'more art than science' and needs to be flexible.

Whose approach does Waller's perspective contrast with?

According to Barron's, Waller's defense of forward guidance contrasts with that of Warsh.

Which specific timeframe of guidance did Waller cite?

Waller cited the guidance from Fall 2021.

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