Tags: fed | jobs | Kocherlakota

Minneapolis Fed Chief: Central Bank Doing OK on Jobs

Sunday, 01 April 2012 04:57 PM

Federal Reserve Bank of Minneapolis President Narayana Kocherlakota said the Fed has done the best it can to spur a recovery in the U.S. labor market, even with the unemployment rate persisting at 8.3 percent.

“The Federal Reserve is performing about as well as it can on both mandates,” Kocherlakota said Saturday, referring to the Fed’s obligation to achieve full employment and price stability. “The level of ‘maximum employment’ achievable through monetary policy is less than the ‘full employment’ of labor resources,” he said in the summary of remarks in Evanston, Illinois.

The Minneapolis Fed chief repeated the speech he gave in St. Louis on March 20.

Kocherlakota has said he doesn’t see the need for more Fed easing given the progress of the U.S. economic expansion. The Federal Open Market Committee this month kept policy unchanged, saying unemployment is still “elevated” even after recent improvements in the job market.

“In terms of employment, there are limits to what monetary policy can achieve on its own,” Kocherlakota said at the Midwest Economics Association’s annual meeting. He doesn’t vote on the policy-setting FOMC this year.

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