Tuesday, June 07, 2005

Reading the Fed's tea leaves

Like the Kremlinologists of yore, central bank watchers are always tempted to read between the lines and derive meaning from seemingly inconsequential remarks. Well, at least that's how I feel today. It seems everyone else (see here) is reading Greenspan's remarks in a different light than yours truly. I believe he might be signalling that short and long term rates were bound to rise in the none-too-distant-future, while others see these comments as a sign that rates will be low for quite some time.

We'll know more soon, as Greenspan is set to testify before Congress later this week.