Fed’s Kocherlakota blasts new rate guidance

(Reuters) – The Federal Reserve should have promised to keep rates near zero until U.S. unemployment falls below 5.5 percent, as long as inflation and financial stability risks are contained, said the lone dissenter to the Fed’s policy decision this week.

Minneapolis Federal Reserve Bank President Narayana Kocherlakota speaks at a macro-finance conference hosted by the Boston Federal Reserve Bank and Boston University in Boston

By instead dropping its pledge to keep rates low until the jobless rate reaches a more healthy level, the Fed is sending the wrong message on both inflation and jobs, Minneapolis Federal Reserve Bank President Narayana Kocherlakota said in remarks released on Friday.

On Wednesday the Fed, in its first policy-setting meeting under Fed Chair Janet Yellen, said it would factor in a wide range of economic measures as it judged the correct timing for raising rates.  Read more

Categories: Economy, United States

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.