Federal Reserve Bank of Philadelphia President Patrick Harker said on Tuesday that he supports a 25bps rate hike in March and that while the Fed could do a 50bps rate increase, he is a little less convinced of that right now. 

Additional Remarks:

"Central banks can influence demand through monetary policy."

"The Fed is not behind the curve but needs to move now to try to control inflation."

"The Fed will stop tapering in March."

"The Fed needs to see how the data turns out in the coming weeks."

"The economy is at maximum employment so it's about inflation."

"25bps rate hikes are appropriate this year, but there's a lot of risk."

"Persistent inflation would continue to worry him."

"If inflation stays where it is and starts to come down he doesn't see a 50bps increase."

"If there was a spike in inflation, the Fed may need to move more aggressively."

"We're probably going to have a bad jobs report at the end of this week because of Omicron."

"Monetary policy does not affect supply constraints."

"The Fed is there on dual mandate with regards to inflation and with regards to employment and needs to act."

"Has to reassert that the fed funds rate is the primary tool for monetary policy."

"Balance sheet reduction will be faster and steeper than the last time the Fed did it."

"Balance sheet normalization should be like watching paint dry."

"The Fed is actively looking at whether it will need to sell assets but no decisions have been made."

"I am committed to making sure the Fed starts reducing the balance sheet this year."

Market Reaction

The dollar was little moved in reaction to the latest remarks from Fed's Harker, who indicated as other Fed members have that the central bank will take a data-dependent approach when deciding upon the speed of monetary stimulus withdrawal.