Good day. Monetary policy is in the right spot after three rate cuts this year, said Federal Reserve governor Lael Brainard, who also discussed ways the central bank may be able to improve how it makes interest-rate decisions. Meanwhile, Dallas Fed President Robert Kaplan expressed comfort with where rates stand, and the New York Fed added $92.7 billion to the financial system in its continuing market interventions.

Please note: The central banking newsletter won’t be published Thursday or Friday as the U.S. celebrates Thanksgiving.

Now on to today’s news and analysis.

Fed governor Lael Brainard said three central-bank rate cuts have put monetary policy in the right place for now, in remarks that also sketched out her preferred path for updating central-bank tools to deal with a low interest-rate world.

An expansive speech by Fed governor Lael Brainard appeared to suggest that at least part of the central bank’s rate-rise campaign that ran between the ends of 2015 and 2018 was misguided.

Ms. Brainard delivered remarks that showed she’s on board with her colleagues’ collective view that after three rate cuts, the Fed can move to the sidelines for now unless something unexpected happens. She also devoted considerable time to how she thinks monetary policy might be updated to deal with an environment defined by persistently low inflation and historically low interest rates. Read More.

Dallas Fed leader Rob Kaplan on CNBC said he thinks monetary policy is in the right place. "I'd need to see some material change in the outlook to cause me to want to adjust" the current level of short-term rates, he said. Mr. Kaplan also said the Fed is having to weigh the risks that low rates could kick off financial instability with an environment where rates are lower than they have been historically. (Dow Jones Newswires)

The New York Fed added $92.7 billion in temporary liquidity to the financial system Tuesday. The intervention came in two parts. There were $72.75 billion in overnight repurchase agreements, or repos, and $19.95 billion in 14-day repos. The Fed took all the securities it was offered.

The Brazilian real will remain weak thanks to unprecedented low interest rates, UBS said. Even though other factors could be weakening the currency, the end of historically high fixed-income yields means investors have incentives to dump Brazilian assets. Brazil's benchmark Selic rate is widely expected to end this year at 4.5%, about 1 percentage point above inflation, a level never seen in recent memory. (Dow Jones Newswires)

Net income for the 5,256 commercial banks and savings institutions insured by the Federal Deposit Insurance Corp. totaled $57.4 billion in the third quarter, down 7.3% from a year earlier. The FDIC cited higher noninterest expense and loan-loss provisions and realized securities losses. Net income declined due to nonrecurring events at three large institutions, FDIC said. "The banking industry reported positive results this quarter, despite nonrecurring events at three large institutions that affected quarterly net income," FDIC Chairman Jelena McWilliams said. (Dow Jones Newswires)

8:30 a.m.: U.S. Commerce Department releases second estimate of third-quarter GDP, October durable-goods data
10 a.m.: Commerce Department releases October personal income, outlays
2 p.m.: Fed releases beige book report on U.S. economic conditions

U.S. markets closed for Thanksgiving holiday
Time N/A: Bank of Korea releases policy statement
3 p.m.: European Central Bank’s Lane speaks on why interest rates are so low in Dublin

"As bond yields have dropped around the world this year, an old specter has again begun haunting markets: 'Japanification.' Former Bank of Japan chief Masaaki Shirakawa was the latest to warn about the dangerous prospect in a speech last month," writes Mike Bird of the Journal. "The phrase is a code word for meager growth, nonexistent inflation and ossified financial markets. But relative to its parlous reputation, Japan’s economic performance has been strong, especially in the context of its shrinking population. And its financial markets have provided solid opportunities relative to most of the world. One reason: Japan has done very well at boosting the productivity of those workers it does have."

"It was French economist Frédéric Bastiat who argued that breaking windows is a poor path toward economic growth. But the recent performance of his homeland appears to disprove the rule," WSJ's Jon Sindreu writes. He says that the economic reforms of President Emmanuel Macron have had a clear-cut effect on business registrations: "Thanks to tax cuts and more generous business visas, the number of startups setting up shop in France has surged." Mr. Sindreu adds: "Yet it was Mr. Macron’s decision to put a brake on some of his most unpopular economic policies in response to yellow-vested protests that may have provided the biggest short-term boost to the economy. To appease the rioters, he increased public spending, pushing the budget deficit above 3% of gross domestic product after years of steady reductions. The stimulus has proven timely, given the global slowdown."

• U.S. home-price growth accelerated in September, a second month of price increases after a long period of decelerating gains.
• A measure of U.S. consumer confidence fell in November for the fourth month in a row, another sign that American households are pulling back amid a global slowdown and continued trade war fears.
• China offered its most positive message in recent weeks that trade talks with the U.S. were going smoothly after a phone call Tuesday between the countries’ top negotiators, raising the prospects for a limited deal sought by both nations.
• U.S. government bond prices rose after Chinese officials offered an upbeat assessment of recent trade talks, a move some analysts said signaled investors’ skepticism about the negotiation process.
• China is taking advantage of low global yields to raise $6 billion in its largest-ever dollar bond sale. The deal found strong demand, showing that investors are eager to lend to China despite the challenges posed by the country’s slowing growth and trade tensions with the U.S.

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