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00:00Deutsche Bank Citi JP Morgan Goldman all calling for rate hikes in March some of your colleagues doing the same. What obstacles are left if any for making a move that soon. Well you know the economy is on a really good track. The inflation numbers are high. It looks now. Inflation is more persistent going forward early in the pandemic. Earlier you know in the last year a lot of those rate price increases were really on things that were really tied to the reopening of the economy in the supply chain. Now those price increases abroad. So if the economy in March looks like it does today and the outlook is similar. And of course there's uncertainty around that. But if it does and I would support moving the funds rate up at that meeting and starting to move back from some of the extraordinary accommodation we needed earlier in the pandemic. And you know I just want to point out that even when we make that first rate move whenever it is that's not really policy tightening accommodation. It's still going to be really high at that point. So you know I think that the case is really strong to begin to win back some of that accommodation. Well that raises the question for our friends on the trading floor of how far how fast and where do you stop. Bill Dudley says you probably need to do four or five rate moves this year. You've long been an inflation hawk. How far do you think you need to go. Well I can tell you in that December S & P submission I had three pencilled in for for this year and a few more over in the next trajectory. But I also want to point out that we're going to have to see how the economy does over time before we can say for sure how many rate increases are needed. You know there's still a lot of uncertainty around the outlook. There's uncertainty about how the pandemic plays out as we've seen each new variant. The economy has really navigated it in terms of the economic outlook. But right now you know we have to say that we probably need to recalibrate our policy stance because inflation is well above where we need it to be. The employment markets you know labor markets are tight. From the standpoint of a policy relevant framework do I think we'll see labor force participation move up somewhat after we get beyond the pandemic. Of course. And I don't think we can ignore the short run or medium run tightness in that labor market. So I think we're in a good place to move policy. And you know we'll have to see how that affects the economy going forward and the other factors affecting economic growth and employment going forward.

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Fed’s Mester Backs March Rate Hike Given Conditions Now

Federal Reserve Bank of Cleveland President Loretta Mester says she would support moving the Fed funds rate up at the March meeting if the economy in that month looks like it does today. "I think the case is really strong to begin to wind back some of that accommodation,” Mester says on "Bloomberg The Open." (Source: Bloomberg)

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