Palm dessert, California (Reuters) – The president of the Federal Spare Bank Dallas Lorie Logan on Friday reiterated her opinion that even if the inflation is closer to the Fed 2% aim of 2% in the coming months, the US Central Bank should not necessarily reduce the short -term borrowing costs. “I think there is a real question about how restrictive monetary policy is currently,” Logan said at a banking conference organized by the University of South Methodist at Palm Dessert in California. “And so I think we have to be careful.”
And, Logan signaled, it remained far from clear whether inflation would really cool down in the short term, noticing the form of the last years of greater inflation at the beginning of the year, when companies usually tend to implement price increase.
In January, US consumer inflation increased the fastest pace in almost a year and a half, the data announced this week.
In the second potential signature of the upward inflation pressure, Logan pointed out surveys in banks that reveal a lot of optimism in relation to the economic growth and demand demand.
And, she said, the Central Bank will watch geopolitics and still an unscientific policy of Administration by President Donald Trump.
In the meantime, the labor market was strong, with the unemployment rate reduced to 4.1%in January.
“I think we are currently in a good position to watch the data over the coming months … and take the time to really look at the information and see how these potential changes develop,” she said.
Logan said she had a view of the recent increase in the long -term borrowing costs, which she attributed to the expectations for a stronger growth ahead, and maybe care about inflation.
For now, she said, he does not think that the financial conditions are wide as as solid that the Fed reacts by reducing the rates.
“We’re not there right now,” Logan said. “What I am most focused on is that … inflation is at our goal of 2%.”
(Reporting Ann Saphir; Mounting Leslie Adler and David Gregorio)
