Fed's Hammack says not all market swings are bad - Breaking The News

Fed's Hammack says not all market swings are bad

24 April

1 min read

EPA/SHAWN THEW

Federal Reserve Bank of Cleveland President Beth Hammack said money market liquidity is still "abundant," and some market swings are "not a bad thing."

She warned that a large Fed balance sheet can lead to more risk-taking and stressed there is an "incredibly high bar" for the Fed to step in and help markets. Hammack also supported the Fed's standing repo facility as a tool to manage liquidity.

She said the Fed can continue reducing its balance sheet and backed the slower pace of cuts, which allows for a "longer process." Since 2022, the Fed's balance sheet has dropped from $9 trillion to $6.8 trillion.

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