The US economic recovery appears sustainable, and the Federal Reserve may have to raise interest rates soon, according to Cleveland Fed chief Loretta Mester.
“If incoming economic information continues to support my forecast, I would be comfortable with liftoff in the first half of this year,” Reuters quoted Mester as saying at a forum Monday.
“The economy is making substantial progress toward the Federal Reserve’s goals” of full employment and two percent annual inflation, she said.
Fed officials meet next week and are increasingly expected to remove from their statement language that they will take a “patient” approach to their first rate hike since 2006.
While inflation remains weak, Mester said she is “reasonably confident” that prices will rise by the end of next year.
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