For all that, Hooper -- like many economists -- faces a conundrum: Growth is still projected to be above its cruising speed, estimated at 1.8 percent by Fed officials.
With the labor markets tight and inflation around its 2 percent target, the Fed’s policy rate needs to be somewhere in the vicinity of neutral if not a little higher.
Deutsche Bank still foresees four hikes for next year but “recent developments say there’s downside risks to that forecast," Hooper said.
Powell Testimony
One thing forecasters won’t lack is frequent updating from the central bank. Powell moves to eight press conferences a year in 2019, from four. New York Fed President John Williams speaks Friday on the global economy in New York. Powell will address the Joint Economic Committee next Wednesday.
“Now we are shifting to a situation where they are going to be debating at each meeting whether further rate hikes are warranted,” said Omair Sharif, senior U.S. economist at Societe Generale SA in New York. “They don’t know what the right level is. They are going to be in the same boat the rest of us are in watching the data.”
This article was provided by Bloomberg News.