Lael Brainard, a Federal Reserve governor, told the New York Association for Business Economics
that the Fed should raise its benchmark interest rate “soon,” despite new evidence that inflation remains below the level the Fed desires.
Despite Weak Inflation, Fed Is Likely to Raise Interest Rates in June -
By BINYAMIN APPELBAUMMAY 30, 2017
WASHINGTON — A speech by a Federal Reserve governor Tuesday underscored a basic shift in Fed policy:
The central bank now needs to be convinced that quarterly rate increases are a bad idea.
“If the soft inflation data persist, that would be concerning and, ultimately, could
lead me to reassess the appropriate path of policy,” Ms. Brainard said in New York.
“On balance, when assessing economic activity and its likely evolution, it would be reasonable to conclude
that further removal of accommodation will likely be appropriate soon,” Ms. Brainard said.
But beyond June, Ms. Brainard added, she might reconsider the wisdom of additional rate increases if there is not evidence of stronger inflation.
