Economics
Dudley Foresees Need for Fed Rate Hikes to Slow the U.S. Economy
- Outgoing New York Fed chief defends central bank’s rate plan
- Blaming emerging-market turmoil on Fed goes too far, he says
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The Federal Reserve will probably have to raise interest rates in the years ahead above levels officials consider neutral for the U.S. economy because of how far the unemployment rate has fallen, outgoing New York Fed President William Dudley said.
“The federal funds rate will probably have to climb a little bit above neutral, because the unemployment rate is already -- from most people’s vantage points -- below a sustainable level of unemployment consistent with stable inflation,” Dudley told reporters Friday. “So, I think the move will be eventually to a slightly tight monetary policy.”