The high U.S. jobless rate and low inflation mean the Federal Reserve will likely keep its near-zero interest-rate policy in place for quite some time, a top Fed official said Monday.
The U.S. central bank's policy-setting Federal Open Market Committee is due next week to reconsider its pledge to keep rates low for an "extended period," a vow it has had in place since it cut its key short-term interest rate target to near zero in December 2008.
Asked how long he expects the Fed to keep that pledge in place, Chicago Fed President Charles Evans reiterated his view that policymakers will keep it for another three or four meetings, or about six months.
"It depends on the state of the economy," Evans said on the sidelines of a financial literacy event in Chicago. "If the economy were to change very, very quickly, I would be delighted, and we would respond appropriately.
But given the long period of higher-than-desired unemployment, I would expect that policy would continue to be accommodative for quite some time.
"In terms of monetary policy we are going to keep our eye on price stability," he said.
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