MNI BRIEF: Fed's Daly Thinking About Faster Taper, Rate Hike

San Francisco Fed President Mary Daly said Thursday that stronger-than-expected inflation means she supports looking at faster tapering of asset purchases and perhaps even early planning around raising record low interest rates.

“We’re dealing with inflation that’s above our target, and inconsistent in its current readings with our longer-run views on price stability, so we have to deal with that, that’s the job,” she said during an online discussion. While labor supply may eventually pickup and help balance out the job market, that's not enough reason to hold back, she said.

“People who might be sidelined and not getting jobs, they are also paying higher prices, inflation is a pretty regressive tax," she said. "We might need to, and I’m a proponent of this, taper asset purchases faster than we had anticipated, and start dialing down some of the extra accommodation we are giving to the economy and then start crafting a plan to at least think about raising the interest rate."