Former Fed hawk Mester following up on her......>

FED: Former Fed hawk Mester following up on her more balanced/cautious addresses

made in early Jan, once again citing tighter financial conditions & sentiment as

downside risks.

- Mester noted that she fully supported decision to maintain fed funds rate at

2.25-2.5%. Policy, for the time being, is well-calibrated to econ outlook and

risks around it.

- Mester noted that the most likely outcome is that the economic expansion will

continue in '19, with growth moving down to at or slightly above trend, but move

unlikely to be smooth. There's uncertainty around forecast.

- Mester also stressed that the Fed has time to assess. If the economy performs

as she expects, the fed funds rate may need to move a bit higher. But if

downside risks come to pass and economy is weaker than expected, she will adjust

my outlook and policy views.