Chicago Fed’s President Urges Central Bank to Be Patient on Rates

Chicago Federal Reserve Bank President Charles Evans on Wednesday again urged the U.S. central bank to be “exceptionally patient” on raising rates, noting downside risks to both growth and inflation.

With longer-term inflation expectations falling near post-crisis lows, Evans said he was “concerned about the possibility that inflation will not return to our 2 percent target within a reasonable period of time.”

That, coupled with continued slack in labor markets, argues for “being patient about when we first increase the federal funds rate and being patient about setting the pace of rate increases once we have begun to move,” he said.

The Fed has kept interest rates near zero since December 2008 and has bought trillions of dollars of long-term securities to push borrowing costs still lower.

via CNBC