Federal Reservations

WASHINGTON (MarketWatch) -- The Federal Reserve would have to begin to exit from its ultra-low monetary policy if inflation accelerates, said Richmond Fed President Jeffrey Lacker on Thursday. "If inflation risks materialize, I think we would need to respond by initiating exit even if growth remained disappointing," Lacker told reporters following a speech. Lacker said the consensus is for the economy to rebound in the second half of the year and for inflation to trend down to around 2%. Lacker said he was pretty comfortable with the inflation outlook now but that there was an upside risk to the inflation outlook. "There is going to be a risk of a step-up in inflation trends. We have seen that over the last nine months. Whether that is finished playing out or not, we don't have the data yet," he said. "I am hoping and expecting inflation to stabilize at around a 2% trend but there is the risk that it would continue to accelerate," he said. Lacker said he was comfortable with the current stance of policy but added that "I think we are going to have to watch carefully."

Originally from MarketWatch

The Federal Reserve should remain on the sidelines because any more easing at this point would boost inflation but not growth, a central bank official said Thursday

Originally from MarketWatch

The Federal Reserve should remain on the sidelines because any more easing at this point would only boost inflation but not growth, a central bank official said Thursday

Originally from MarketWatch

U.S. economic growth could remain soft for some time but monetary policy may not be able to address the problem, Richmond Federal Reserve Bank President Jeffrey Lacker said on Monday.

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The president of the Richmond Federal Reserve on Tuesday reiterated his concern about inflationary pressures in the U.S. economy, saying financial market inflation expectations were on the upper end of historical trends.

Originally from All News, Video and Posts related to TOPIC: Federal Reserve

WASHINGTON (MarketWatch) -- It is important that the Federal Reserve not fall behind the curve in the battle against higher prices, said Jeffrey Lacker, the president of the Richmond Fed Bank on Wednesday. "It is far better to act primitively than to get behind the curve on inflation and have to catch up," Lacker told reporters after a speech here. Lacker criticized the Fed's tightening in the last business cycle - when the Fed hiked the fed funds rates at a steady quarter-point pace from 2003 until 2006 as "too cautious." "We were a little to careful about not roiling markets, a little too careful about being predicable," and as a reslt inflation was near 3% instead of 2% or below, he said. "I think this is a point in the business cycle when the risk of losing a bit of credibility and losing ground on inflation is highest."

Originally from MarketWatch

WASHINGTON (MarketWatch) -- The end of the Fed's $600 billion bond-buying program at the end of June should be the "high-water mark" of the Fed's stimulus efforts in this cycle, said Jeffrey Lacker, the president of the Richmond Federal Reserve Bank on Tuesday. The focus going forward will be on the timing and pace of the withdrawal of the stimulus, Lacker said in a speech to business leaders here. Lacker said that the Fed must bear in mind that inflation can rise even if the level of economic activity has returned to its pre-recession trend. "To prevent that, it may be necessary to initiate policy tightening well before the unemployment rate has fallen to a rate we would expect to see over the long run," he said. Lacker continued to be upbeat about the economy. He said it is now clear that the unemployment rate is headed in the right direction. Higher gasoline prices should not dampen consumer spending for long. Lacker said growth should continue for the next few years at a solid above-trend pace although the rate of growth may fluctuate from quarter to quarter. "We should be careful not to read too much into every month's little data jiggle," he said.

Originally from MarketWatch

The Federal Reserve needs to start unwinding its monetary easing programs before inflation becomes a serious problem, Richmond Fed President Jeffrey Lacker told CNBC.

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The president of the Richmond Fed says the U.S. central bank should seriously review its $600 billion bond-buying plan in light of the distinct improvement in the economy.

Originally from MarketWatch

NEWARK, Delaware (Reuters) - The Federal Reserve should seriously consider pulling back on its $600 billion stimulus program given stronger growth and a brighter jobs picture, Richmond Fed President...

Originally from Reuters: Business News