Federal Reserve Bank of Chicago President and FOMC member Charles Evans on Friday said the current Fed policy had been “wrong-footed” in the face of high inflation, but may not need to become restrictive. A “substantial repositioning” of policy could be done with a low risk to jobs, he continued, adding that he still feels much of the current wave of inflation is due to supply and other pandemic-related shocks will ease. Underlying inflation, he added, still remains well anchored at a level consistent with the Fed’s 2.0% objective, Evans said.

Market Reaction

Volatility ahead of the 4pm London Fix, signs of escalating fighting in Easter Ukraine and Evan’s comments that the Fed could do “substantial repositioning” of its policy with a low risk to jobs all seem to have given US dollar some impetus in recent trade. The DXY recently popped back to the north of the 96.00 level and is back at session highs, now up 0.2% on the day. 

This article was originally published by Fxstreet.com.Read the original article here.

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