According to the most recent data, ROE is forecast to be close to 8 per cent on average this year and the next; three banking groups are expected to report a profitability close to or above 9 per cent and none should end the year with a loss.
For instance, both the modest policy tightening of the spring of 1997 and some portion of the easing of last fall could be viewed as insurance against potential adverse economic outcomes. As I have already indicated, by its June meeting the FOMC was of the view that the full extent of this insurance was no longer needed.