Central Banks
Fed’s Jefferson Warns of Easing Too Much on Improving Inflation
- Fed vice chair says cuts likely appropriate ‘later this year’
- Philadelphia’s Harker says Fed has ‘time to get this right’
This article is for subscribers only.
The Federal Reserve needs to be on guard against cutting interest rates too far in response to falling inflation lest it undermine the achievement of its ultimate goal of price stability, Vice Chair Philip Jefferson said on Thursday.
“We always need to keep in mind the danger of easing too much in response to improvements in the inflation picture,” he said in a speech prepared for delivery to the Peterson Institute for International Economics. “Excessive easing can lead to a stalling or reversal in progress in restoring price stability.”