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Fed’s Kaplan Says Expect Rising Bond Yields as Economy Mends

  • Revises 2021 GDP forecast to 4.5% to 5% from 3.5% in November
  • Fed tapering should follow widespread recovery, vaccinations
Robert Kaplan

Robert Kaplan

Photographer: Krisztian Bocsi/Bloomberg
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Federal Reserve officials shouldn’t intervene to slow rising bond yields because that is expected to happen as the U.S. economy recovers, said Federal Reserve Bank of Dallas President Robert Kaplan.

“If the steepening, which I would expect, occurs because of stronger economic growth, fiscal stimulus and better economic prospects, I think that’s to be expected,” Kaplan said in an interview with Bloomberg News on Thursday. “I’d be hesitant to step in and take action that could distort that natural trend.”