The Globe and Mail reports in its Monday edition that two Federal Reserve policy-makers on Saturday said they feel the Fed's job on taming inflation is not yet done, but also do not want to risk damaging the labour market in the process.
A Reuters dispatch to The Globe reports that the remarks, from Fed governor Adriana Kugler and San Francisco Fed president Mary Daly, highlight the balancing act facing the Fed this year, after lowering short-term rates by a full percentage point last year.
Fed policy-makers in December signalled they expect to reduce rates more slowly this year to bring inflation down to the Fed's 2-per-cent goal.
"We are fully aware that we are not there yet -- no one is popping champagne anywhere," Ms. Kugler said at the annual American Economic Association conference in San Francisco. "And at the same time we want the unemployment rate to stay where it is" and not increase rapidly. In November, unemployment was at 4.2 per cent.
"At this point, I would not want to see further slowing in the labour market -- maybe gradually moving around in bumps and chunks on a given month, but certainly not additional slowing in the labour market," said Ms. Daly, who was speaking on the same panel.
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