Fed Faces Tough Task Deciding When To Stop Raising Rates, Daly warns (FT)

An FT interview with San Francisco Fed President Daly has been published. Below are some key snippets from the piece:

• “This next phase of policymaking is much more difficult, because you have to be mindful of so many things.”
• “You have to be mindful of the cumulative tightening that’s already in the system. You have to be mindful of the lags in monetary policy. You have to be mindful of the risks that are all throughout the global economy and the tremendous uncertainty that we have even about what the evolution of inflation is going to be.”
• “If I can do one thing for the public, I would say: stop thinking about pace and start thinking about level.”
• “If I can hold it there [at an elevated level] for a year and really think that inflation is coming down, then that’s probably a reasonable rate to stop at. Overnight to 2 per cent is not my goal . . . but we can’t be so patient that inflation continues to erode the real purchasing power of Americans.”