Boston Fed Rosengren:"Advisable Remove Accommodatn Next 1.5Yrs

By Sheila Mullan

     NEW YORK (MNI) - Boston Fed President Eric Rosengren said that it was

"advisable" for the Fed to "remove accommodation" from U.S. monetary policy for

the "next year and a half."

     Rosengren, in comments to audience members following a speech, said that

the Federal Reserve officials "don't want to have to raise" rate "too" fast,

which is a danger if the Fed would wait too long to tighten rates. Such a

delayed tightening runs the risk of the Fed needing to hike rates "too fast" and

the danger of triggering a recession, he said. Rosengren said the Fed did not

want to "have to raise rates too fast."

     He spoke before an audience of economists and traders at the NYU Money

Marketeers.

     Rosengren said that the U.S. economy is "well below" NAIRU "now." 

     He also said that "people are pretty certain that the U.S. will" go back to

2% inflation, referring to private economists and general opinion.

     He added that the U.S.'s R* (R-Star) Rate is "higher than we are now." One

private economist listening told MNI, "it does not sound like he is a fan of

R*."

--MNI New York Bureau; tel: +1 212-669-6432; email: sheila.mullan@marketnews.com