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It was a busy week for Fed Chairman Jerome Powell. On Tuesday he testified in the House Financial Services Committee. On Wednesday he testified before a House panel overseeing the U.S. response to the coronavirus pandemic. On Thursday he appeared before the Senate Banking Committee.

Already having issued powerful forward guidance last week, the Fed Chair once again reiterated that direct fiscal support may be needed as the Fed has limited powers. For evidence of the Fed’s limited tools, look to the Main Street Lending program. This program, which aims to support medium sized businesses that has made a meager $2.4 billion of loans out of a potential lending pot of up to $600 billion. Powell mentioned that he could see $10Bn to $30Bn of loans through the facility by year end.

The seemingly endless quest for more details on what the Fed’s new average inflation targeting regime will actually look like in practice continues. And this week some FOMC participants provided some sound bites, on what inflation “moderately” in excess of 2 percent could mean.

Minneapolis Fed President Neel Kashkari wrote last week that he thinks not raising rates for roughly one year after core inflation first crosses 2 percent is consistent with the strategy of aiming for a modest overshoo...

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