San Francisco Fed President Daly: More time is needed
San Francisco Fed President Mary Daly said it could take “more time” for inflation to return to the central bank’s target.
San Francisco Fed President Mary Daly said interest rates are currently constraining the economy but it could take “more time” for inflation to return to the central bank’s target.
“We are restrictive, but it may take more time to reduce inflation,” Daly said at George Mason University on Thursday, repeating the statements made by Fed Chairman Jerome Powell on April 16.
“There is serious uncertainty about what inflation will be in the next few months and what we should do in response,” Daly said, saying the latest data showing price pressures picked up again earlier this year underlined why authorities could not declare victory until they were sure inflation was under control.
The statements underscored Fed officials’ willingness to keep the central bank’s benchmark interest rate steady until they are confident inflation will continue to ease toward its 2 percent target.
Prices, as measured by the Fed’s preferred inflation index, rose 2.7 percent in March compared to the previous year. This was stronger growth than economists expected and a recovery from the previous three months. Fed officials have kept interest rates in a 23-year high range of 5.25 percent to 5.5 percent since last July.