Central Banks
Fed May Need to Raise Rates to 6%, Monetary Economist Taylor Says
- Rates are too low in real terms, Taylor tells conference
- Ex Fed Vice Chair Kohn forecasts mild recession at conference
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The Federal Reserve needs to raise interest rates significantly higher, to perhaps 6%, to reduce inflation, influential monetary economist John Taylor said on Friday.
He told an economic conference in New York that rates were still “quite low” when measured in real, inflation-adjusted terms or when compared to monetary policy rules like the one he developed some 30 years ago and which bears his name.