Bostic: Fed should avoid 'prematurely' declaring win in jobs battle
Reuters
Published Jun 23, 2021 07:06AM ET
Updated Jun 23, 2021 07:35AM ET
WASHINGTON (Reuters) -A spell of high inflation in the U.S. could last as long as 9 months, but the central bank should still avoid declaring victory too soon in the battle to regain 7.5 million jobs lost during the pandemic, Atlanta Federal Reserve president Raphael Bostic said on Wednesday.
The recent jump in prices will prove temporary, Bostic said, but "temporary is going to be a little longer than we expected initially...Rather than it being two to three months it may be six to nine months," Bostic said in an interview with National Public Radio's Morning Edition.
But Bostic said the Fed should nevertheless keep in view the 7.5 million lost jobs when it assesses where the U.S. recovery stands. Some policymakers think that retirements and other individual decisions may make it hard to return to the pre-pandemic level of employment.
"That is a benchmark we all need to keep our eye on," Bostic said. "We have to make sure our policies don't pivot in ways that make it look like we are declaring victory prematurely."
The Fed at its last policy meeting indicated it may be preparing to raise interest rates sooner than expected because of recent inflation readings that have pushed measures like the consumer price index to multi-year highs.
Bostic was not asked and did not volunteer his view about when the Fed's target policy interest rate might need to increase from its current near zero level, or when the Fed should begin reducing its $120 billion in monthly bond purchases.
Get The News You Want
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.