New York Federal Reserve Bank President William C. Dudley said European economic weakness and U.S. budget woes mean “more needs to be done” to shore up the global economy and financial regulation.
“In the United States, the good news is that the economic outlook appears to be gradually improving,” Dudley said today in remarks to a conference in New York. “For Europe, the near-term macroeconomic outlook seems less bright.”
Dudley said U.S. fiscal policy is not “well-calibrated” to current challenges. For Europe, moving toward banking union is a “critically important next step” to emerge from the sovereign debt crisis.
“It would underscore the fact that a euro is a euro and will remain a euro throughout Europe, reducing perceptions of redenomination risk,” Dudley said.