Boston Fed President Susan Collins spoke on Wednesday, saying that its likely to take longer than expected to get inflation back down to the Fed’s 2% target level:
- More from Fed’s Collins: Very strong jobs market has bolstered consumer spending
- Feds Collins: Expects demand will need to slow to get inflation to 2%
Collins repeating what many of here Federal Open Market Committee (FOMC) colleagues have been saying, rates to remain where they are for longer:
- “The recent upward surprises to activity and inflation suggest the likely need to keep policy at its current level until we have greater confidence that inflation is moving sustainably toward 2 percent,”
Lest she appears too hawkish, though, she did offer this:
- “The current situation requires methodical perseverance, recognizing that progress will take time and continue to be uneven. Expecting all indicators to be well-aligned is too high a bar to start normalizing policy”
The indicators Collins is looking at include:
- inflation expectations
- signs of disinflation
- signals from wages
- moderation of the labor market
Whioch all fits with the Fed’s dual mandate.
This article was written by Eamonn Sheridan at www.forexlive.com. Source