(Ticker) – “Inflation readings are not yet where we need them to be“. He stated this Loretta Masterchairman of the Federal Reserve Bank of Cleveland, in an interview with Bloomberg shortly after data showed the core PCE index (a closely watched measure of inflation by the central bank) rose 4.7% y/o y in January, above expectations and above the December figure.
The report is “simply consistent with the fact that the Fed must do a little more on our official rate to make sure inflation is coming back down,” he added.
In an earlier interview with CNBC, Mester reiterated his support for getting rates “a little” above 5% this year and then stay there for a while.
In a speech in New York today, he said that “while it is good news to see some moderation in inflation readings since last summer, the level of inflation is important and is still too high. Policy decisions need to consider the risk around the forecast, but also the costs of continued high inflation to households, businesses and the long-term health of the economy.”
“At this point – he added with the labor market still strong, the costs of a failure to adjust the policy or a premature loosening of politics still outweigh the costs of an overrun”.
(Photo: Stefan Fussan)