Fed’s Evans says slightly restrictive policy stance ‘makes sense’ … MARKETWATCH
Fed’s Evans says slightly restrictive policy stance ‘makes sense’
By GREG ROBB
Chicago Fed President Charles Evans said Friday it makes sense to move interest rates up until the level of rates is slightly dampening growth.
With the economy growing strongly and the unemployment rate falling, “setting policy ever so slightly restrictively makes sense and we could hold… that level for quite some time,” Evans said, in an interview
The Chicago Fed president said he thinks a “neutral” level of short-term rates is in a range of 2.75-3% and a restrictive policy might be 50 basis points above.
At the moment, the Fed’s fed funds rate is in a range of 2-2.25%.
Evans said he wasn’t worried about inflation and the price index might move up to a 2.2-2.3% range.
He had little to say about President Donald Trump’s criticism of Fed policy.
“We’re looking at a strong economy and we’re adjusting the policy stance,” Evans said.