Fed's Evans "fine" with Dec hike if data stays firm
By Lindsay Dunsmuir and Rebecca Howard
AUCKLAND (Reuters) - Chicago Federal Reserve Bank President Charles Evans said he would be "fine" with raising U.S. interest rates by year end if U.S. economic data continued to come in firm, though any further moves would need to see inflation accelerating.
"I have a forecast where things continue to improve. I do think there will be a rate increase," Evans told journalists on Wednesday after a speech on the U.S. economy in Auckland, New Zealand.
He added he would be "fine" for rates to increase by year end and said any move would likely come at the December meeting, though he did not rule out the possibility of it happening in November.
Evans emphasized that the timing of the next hike was less important than how tightening was conducted beyond that, and he would want to see inflation actually moving up and unemployment falling further.
"I am less concerned about the timing of the next increase than I am about the path over the next three years," Evans said.
Regarding the impact of the upcoming U.S. election on monetary policy, Evans said "we don't know."
He underscored the Federal Reserve will be paying close attention to the government's stance on fiscal policy.
"What the central bank needs to do is have a view point on whether or not fiscal policy is going to be stimulatory or contractionary on the economy over the next three to five years and then we have to decide if we need to take action to offset its effects on inflation," he said. Continued...