One of the important points NY Fed VP Brian Sack made in his speech yesterday was the need for clear communication:
[T]his tightening cycle, when it arrives, will be more complicated than past cycles, as there will be more decision points facing policymakers. With more decision points come more opportunities for the markets to be confused by our actions.
The recent changes to the discount rate and the Treasury's Supplementary Financing Program balances highlight this concern, as the amount of attention that those actions received was outsized relative to their significance for the economy or for the path of short-term interest rates.Source: www.calculatedriskblog.com
