Tags: Fed’s Hoenig ‘Sustainable’ Recovery Brings Rising Inflation

Fed’s Hoenig: ‘Sustainable’ Recovery Brings Rising Inflation

Thursday, 17 Feb 2011 02:53 PM

Federal Reserve Bank of Kansas City President Thomas Hoenig said the U.S. economy is improving “systematically” and inflation has started to slowly rise.

“The economy is improving systematically now and I think on a sustainable basis,” Hoenig said according to the transcript of an interview today on Fox Business Network. “There is indications that inflation is rising slowly, modestly, but still rising,” he said.

Hoenig spoke after a Labor Department report this morning showed that rising food and fuel prices pushed up the U.S. cost of living more than forecast in January. The consumer-price index advanced 0.4 percent for a second month, led by the biggest increase in food costs in more than two years, according to figures today.

“One month’s data is one month’s data,” Hoenig said. “It doesn’t tell you if you have an inflation problem.”

“The issue with inflation is that it always is very small increases,” he said. “It starts slowly, perhaps as we’re seeing now, and builds over time.”

Fed presidents rotate voting on monetary policy and Hoenig, 64, will not vote this year. He joined the Kansas City Fed in 1973 as an economist in banking supervision, after earning his doctorate at Iowa State University. Hoenig became president of the Kansas City Fed in 1991.

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Federal Reserve Bank of Kansas City President Thomas Hoenig said the U.S. economy is improving systematically and inflation has started to slowly rise. The economy is improving systematically now and I think on a sustainable basis, Hoenig said according to the transcript...
Fed’s Hoenig ‘Sustainable’ Recovery Brings Rising Inflation
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2011-53-17
Thursday, 17 Feb 2011 02:53 PM
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