Loretta Mester

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Last quote by Loretta Mester

In my view, if economic conditions evolve as I anticipate, I would be comfortable changing our reinvestment policy this year. I actually built into my forecast more than three because I have the economy a bit stronger. An upward policy path will help prolong the expansion, not curtail it.
Mar 22 2017
This page is completely dedicated to what Loretta Mester has to say. All of Loretta Mester’s quotes are organized here by date and topic. The most recent quote attributed to Loretta Mester came from an article called Cleveland Fed chief 'comfortable' raising rates if economy keeps performing: “The return to primarily Treasuries will take some time, but it will be welcome because ... it may help guard against future calls for the Federal Reserve to enter into the realm of fiscal policy.”.
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Loretta Mester quotes

This is a solid number. This is very consistent with what we expected to see, certainly with my forecast.

We have to be a little pre-emptive in making sure that we're moving the interest rate up so that we can keep the expansion sustained.

Policymakers...should not throw out all that's been learned from past experience or be led astray by thinking this time is completely different.

The underlying strength in the economy is demonstrated by the resiliency it has shown through a number of bumps along the road of expansion.

In addition, if we delay too long and then find ourselves in a situation where the labor market becomes unsustainably tight, price pressures become excessive, and we have to move rates up steeply, we could risk a recession, a bad outcome that history tells us disproportionately harms the more vulnerable parts of our society.

If we continue to delay even as we make further progress on our inflation goal and labor markets continue to tighten...and we have to move rates up steeply, we could risk a recession.

It seems like a gradual increase from a very low interest rate that we are at now is pretty compelling to me.

I think the economy is on a good track. I think the employment numbers show that, I think the inflation's numbers are coming up slowly, they're below our target still but they're moving in the right direction.

I go into the meetings with an open mind. I like to hear what my colleagues say, I like hearing diverse views about the economy. And of course, we all have our own forecasts and frameworks for doing policy.

I see a gradual upward pace in interest rates as being appropriate. Now, that doesn't mean we're behind the curve now. But I do think that it makes sense to be starting to move interest rates up on that gradual path.

Payroll growth slowed considerably in May, raising the question of whether we were at the start of a reversal from the considerable progress that's been made in labor markets, or whether the weak reading was the type of transitory change we typically see during expansions.

If our macroprudential tools proved to be inadequate and financial stability risks continued to grow, I believe monetary policy should be on the table as a possible defense. The Fed's key price stability and maximum employment goals usually align with its desire for a stable financial sector.

Waiting too long increases risks to financial stability and raises the chance that we would have to move more aggressively in the future, which poses its own set of risks to the outlook.

If we fail to gracefully navigate back toward a more normal policy stance at the appropriate time, then I believe there is a non-negligible chance that these tools will essentially be off the table because the public will have deemed them as ultimately ineffective. This is a risk to the outlook should we ever find ourselves in a situation of needing such tools in the future.

You can't read too much into one number, but it is certainly part of the data that will be taken into account as we go into the June FOMC meeting and for the rest of the year.

Financial stability should not be added as a third objective for monetary policy.

If our macro prudential tools proved to be inadequate and financial stability risks continued to grow, I believe monetary policy should be on the table as a possible defense.

Some parts of the economy are doing better than others. But the message I take from U.S. economic performance is that despite financial market volatility, despite the pain inflicted on the energy sector from falling oil prices, and despite the relatively weak growth abroad, the U.S. economy has proven to be remarkably resilient.

She understands arguments against hiking. We live with uncertainty and one could always make the case that we should wait to act until we gather more information. But waiting until every piece of data lines up in the correct way means waiting too long and risks having to move rates up more aggressively in the future, with negative impacts on our economy.

These more likely reflect changes in liquidity premia and inflation risk premia rather than changes in inflation expectations.

She believes "the appropriate policy path will involve gradual reductions over time in the extraordinary level of accommodation that was necessary to address the Great Recession.

I would feel better if we could get a few more rate increases and not have to worry about the balance sheet. There's no compelling reason now to shrink the balance sheet.

I'm pretty comfortable with the median path ... I think that's not a bad description.

I don't see anything in the data that has changed the dynamics of inflation.

I fully supported the ... December action. It was prudent to take the first step on the path of gradual normalization of interest rates.

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