Federal Reserve Bank of Dallas President Richard Fisher said the U.S. central bank shouldn’t be faulted for using every tool available to bolster growth, even if monetary policy on its own can’t revive the job market.
“I don’t think anybody could fault the chairman or the FOMC for using every tool at its disposal to get the economy up and running again,” Fisher said to reporters today after a speech in Dallas, referring to the policy-setting Federal Open Market Committee and Fed Chairman Ben S. Bernanke.
The FOMC announced a third round of quantitative easing this month, saying it will buy $40 billion of mortgage bonds every month until the employment outlook improves. Policy makers have a duty to keep prices stable as well as to achieve maximum employment, and the Fed shouldn’t let inflation rise to support the labor market, Fisher said.
Inflation isn’t a short-term risk, Fisher said after speaking at the University of Texas at Dallas.
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