5 Numbers Bernanke Will Be Watching

These figures will dictate how soon the Fed stops QE

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5 Numbers Bernanke Will Be Watching

Unemployment

jobless unemployment 630 300x227 5 Numbers Bernanke Will Be WatchingAs mind-bogglingly difficult as it is to be a central banker, the Fed’s job description is actually remarkably simple. It has what’s called a dual mandate: Stable prices and full employment. That’s it.

What that normally means is the Fed is supposed to keep inflation in check (usually defined as the historical rate of about 3%) and the unemployment rate at about 5%.

But these are not normal times. Bernanke said that QE would likely come to an end when the unemployment rate is “in the vicinity” of 7%. It’s at 7.6% now — or in the vicinity of being in the vicinity — so expect markets to be especially volatile when the jobs numbers come out at the beginning of every month.


Article printed from InvestorPlace Media, http://investorplace.com/2013/06/5-numbers-bernanke-will-be-watching/.

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