US Federal Reserve governor urged to sharply reduce inflation

US Federal Reserve governor urged to sharply reduce inflation

US Federal Reserve Governor Christopher Waller has urged the central bank to accelerate the pace of reducing asset purchases in response to rising inflation.

“To me, the inflation figures are starting to look like a big iceberg that will be on the ground for a while, and that growth is affecting my expectations of the level of monetary housing that needs to move forward,” Waller said. In an address at the Center for Financial Stability in New York.

“The timing of any policy action is a decision for the FOMC (Federal Open Market Committee), but for my part the rapid recovery in the labor market and deteriorating inflation data has pushed me to reduce sharply and in favor of a more rapid pace. Have given up housing in 2022,” he said, referring to the Fed’s policy-making committee.

Waller pushed back the argument that monetary policy does not need to respond to temporary price pressures associated with supply constraints.

“All shocks are fleeting and eventually go away; by this logic, the Fed should never respond to a shock, but sometimes it happens, as it should,” he said.

James Bullard, president of the Federal Reserve Bank of St. Louis, has also voiced support for accelerating the pace of reducing asset purchases.

“We can move fast — we’ve put the optionality on whether we can accelerate the taper if it’s appropriate,” Bullard told Bloomberg television, adding that he will take stock of the asset at the end of the first quarter of next year. Proposal to terminate the purchase.

The Fed earlier this week began reducing its $120 billion monthly asset purchase program to less than $15 billion. The central bank will cut monthly purchases by another $15 billion in mid-December. At this pace the taping will be completed by June next year.

According to the Labor Department, the Consumer Price Index (CPI) rose 6.2 percent in October from a year earlier, the strongest annual gain in 30 years.



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