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MNI BRIEF: Uncertain Fed Can Take Gradualist Policy Stance

Source: Federal Reserve

The Federal Reserve is still not sure inflation is heading sustainably back to its 2%, but a more balanced risk outlook means policymakers do not need to rush to any decisions, San Francisco Fed President Mary Daly said Friday.

"At the Federal Reserve, we are not certain whether inflation is on track to return to 2%. We are unsure about the length of policy lags, and whether they are behind us or still to be fully realized," Daly said at a European Central Bank conference in Frankfurt. "When uncertainty is high and the risks to our objectives more balanced, we need to practice gradualism." (See MNI INTERVIEW: Fed Hikes Over, Banks Still Vulnerable-George)

MNI Washington Bureau | +1 202 371 2121 | pedro.dacosta@marketnews.com
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MNI Washington Bureau | +1 202 371 2121 | pedro.dacosta@marketnews.com
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