The Globe and Mail reports in its Tuesday, Oct. 4, edition that Federal Reserve Bank of New York president John Williams said on Monday that while there have been nascent signs of cooling inflation, underlying price pressures remain too high, which means the U.S. central bank must press forward to get inflation under control.
A Reuters dispatch to The Globe reports that Mr. Williams said: "Clearly, inflation is far too high, and persistently high inflation undermines the ability of our economy to perform at its full potential. Tighter monetary policy has begun to cool demand and reduce inflationary pressures, but our job is not yet done."
Mr. Williams, who also serves as vice-chairman of the Fed's interest rate-setting Federal Open Market Committee, did not offer a view about what is next for monetary policy. However, he said the Fed will continue to press forward with actions aimed at cooling demand, in a bid to help lower inflation back to the Fed's 2-per-cent target. Inflation was at 6.2 per cent in August compared with the same month a year ago.
Mr. Williams said lower economic growth and higher unemployment are very likely to be side-effects of the Fed's inflation-fighting mission.
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