“The economy is doing a lot better,” Plosser said today in an interview on CNBC. “We’ve actually seen a pretty substantial firming of growth. We’re entering growth here in the first part of the year on a much firmer stance than last year.”
The Fed may need to raise interest rates “sooner than people expect,” Plosser said. Economic growth increased to 3 percent in the fourth quarter and the unemployment rate fell last month to an almost three-year low of 8.3 percent.
“We could raise rates somewhat and still be at a very easy policy stance,” Plosser said. “One percent is still pretty accommodative.”
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