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- Fed's Mester: We need to move rates up at a pace to get inflation turning lower
Fed's Mester: We need to move rates up at a pace to get inflation turning lower
Cleveland Fed President Loretta Mester on Tuesday said that the Fed needs to move up rates as a pace to get inflation turning lower, according to an interview with Yahoo Finance cited by Reuters. Mester said she is comfortable with moving rates up in 50 bps intervals at another couple of meetings.
Additional Remarks:
"We will need evaluate if there is a need to speed rate hikes up, or go slower."
"I will need compelling evidence that inflation is moving down."
"So far, I have not seen compelling evidence."
The Fed needs to get its monetary policy to a more neutral stance, then evaluate how much further tightening is needed.
The neutral nominal rate of interest is about 2.5%.
"We may need to go above neutral to get inflation down."
"I think we will need to go beyond neutral."
"I am open to seeing how things evolve in second half of year and next."
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