Fed near limit on scope to help jobs: Kocherlakota |
| Reuters - May 23, 2012 |
A rise in inflation over the past year suggests the Federal Reserve has little firepower left to boost employment, a top Fed official said on Wednesday.
Unemployment, at 8.1 percent, is still high by historical standards.
Many economists believe inflationary pressures are only likely to start building if unemployment falls much lower, nearer to 6 percent.
But the fact that inflation is running above the Fed's 2 percent target means "our country's current labor market performance is much closer to 'maximum employment,' given the tools available to the (Fed), than the post-World War II U.S. data alone would suggest," Minneapolis Fed President Narayana Kocherlakota said in remarks prepared for delivery to the Black Hills Knowledge Network here.
The comments were very similar to those Kocherlakota made two weeks ago in Minneapolis, where he said the Fed should probably begin to exit from its super-easy monetary policy in the next six to nine months.
Read Full Article from Reuters
- Posted: 2012-05-23 14:31:45
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