Key points from Logan:
- Fed needs to be flexible with monetary policy.
- The economy is strong and stable.
- There’s a risk to the job market and inflation targets.
- Combining balance sheet reductions and rate cuts.
- Liquidity is high in money markets.
- Aims for ‘negligible’ balances in reverse repo facility over time.
- Fed can adjust reverse repo rates if cash remains in the facility.
The Fed is aiming to ease policies more as unemployment reaches 4.4-4.5%, rather than a gradual decrease to 3.50%.