Tags: fed | mester | jobs | rate

Fed's Mester Sees Gradual Rate Increases Despite Weak Jobs Data

Image: Fed's Mester Sees Gradual Rate Increases Despite Weak Jobs Data

Saturday, 04 Jun 2016 08:30 AM

The Federal Reserve should raise interest rates gradually despite weak jobs data, Fed Cleveland Bank President Loretta Mester said.

U.S. economic growth is picking up, inflation is moving toward target and the country is at full employment, Mester told reporters in Stockholm on Saturday.

“I still believe that in order to achieve our monetary policy goals a gradual upward pace of the funds rate is appropriate,” Mester said. “When the rate hikes will occur and the slope of that gradual path is data dependent.”

The U.S. economy created fewer jobs in May than in any single month in almost six years, according to figures published Friday. That’s fueled speculation the Fed won’t be as eager to tighten monetary policy in 2016 after raising rates late last year for the first time since late 2008 on signs the economy is picking up.

While the jobs data was a disappointment that shouldn’t be downplayed, “you can’t read too much into one number” as seasonal factors loomed large and the Verizon Communications Inc. strike affected the number negatively, Mester said. “The weak employment number has not changed fundamentally my economic outlook” as “the economy is definitely moving in the right direction,” she said.


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The Federal Reserve should raise interest rates gradually despite weak jobs data, Fed Cleveland Bank President Loretta Mester said.U.S. economic growth is picking up, inflation is moving toward target and the country is at full employment, Mester told reporters in Stockholm...
fed, mester, jobs, rate
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2016-30-04
Saturday, 04 Jun 2016 08:30 AM
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