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Nobel Laureate Says Fed Shouldn't Raise Interest Rates Next Week

  • Maskin says inflation too weak to warrant tighter policy
  • Higher rates would exacerbate inequality in U.S., he says
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Blanchard: 'This Is the Time' for Fed Rate Increase

Janet Yellen’s U.S. Federal Reserve shouldn’t raise interest rates next week, because doing so could jeopardize economic growth and worsen inequality, said Nobel laureate Eric Maskin.

“The unfortunate thing is that if you raise interest rates there is a risk -- again, it may be small, but it’s a significant risk -- that you will slow down the recovery,” Maskin said in an interview in Moscow on Tuesday. “Maybe she knows something that I don’t know, and she sees signs of inflation I don’t see, but I really don’t understand why it’s so important to raise interest rates when there is so little to be afraid of.”