Skip to content
Subscriber Only
Business
Economics

George Says Fed Should Allow Asset Runoff Prior to Rate Rise

Federal Reserve Bank of Kansas City President Esther George said the Fed should allow its balance sheet to shrink before raising the main interest rate, differing from an approach backed by New York Fed President William C. Dudley.

“Allowing the balance sheet to decline due to ‘passive runoff,’ which stops reinvesting the maturing securities, prior to the first rate hike is appropriate,” George said today in a speech in Breckenridge, Colorado. She doesn’t vote on monetary policy this year.