When Federal Reserve Vice Chairman Stanley Fischer speaks, markets listen. Not only because Mr. Fischer is an influential member of the Fed’s policy-making body. Also because the former Governor of the Bank of Israel, prior to his appointment to the Fed, seems to be carefully choosing when and what to say.
This week, just as markets across the globe were digesting the shock British vote to leave the EU, Mr. Fischer offered his first public comments on the economy and monetary policy since March 7, according to Bloomberg.
Fischer said the US policymakers were in a wait-and-see mode following the British referendum on the EU:
“We got hit by something. We are still evaluating it,” he said on CNBC. “My guess is that it will be less important for the U.S. than the countries directly involved -- almost just logically so. We will wait and see.”
“… so as we consider the effects of Brexit, we have to put that effect on the U.S. together with what else is going on in the U.S. economy,” he said. “I hope that we strengthen, and that the economy strengthens, and that we continue along this slow, very gradual path we’ve been on.”
Clearly quite a re-assuring talk by a steady-hand at the Fed’s helm.
To me, it comes as a little surprise that Fischer’s first public appearance in three months came just now, amidst the market turmoil caused by the Brexit. When else to use communications as a tool to re-assure the nervous markets that it was business as usual at the US central bank.