...while trying to revive credit markets and fuel economic growth, should ensure that reductions in the benchmark interest rate don't spur inflation, said San Francisco Fed President Janet Yellen.
The Fed "will have to be careful not to leave monetary accommodation in place longer than it is needed," Yellen said to reporters after a speech today in Alameda, California. Otherwise, policy makers may "put upward pressure on inflation" or create "a bubble" of speculation in the economy.
Yellen's view follows that of Minneapolis Fed Bank President Gary Stern, who said last month the Fed may need to prevent excessive market speculation that could damage the economy. Some investors have said the Fed under former Chairman Alan Greenspan left rates too low, encouraging asset bubbles in stock markets in 1999 and in housing markets this decade.
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment