Lorretta Mester is President of the Federal Reserve of Cleveland
Earlier remarks:
- Fed's Mester has a dire outlook on GDP, unemployment but expects economy to pick up later in 2020
- says the Fed is looking for further ways to support economy
Even more now:
- says lower inflation caused by coronavirus pandemic could lead to lower inflation expectations
- US unemployment rate is moving in the right direction but it could remain elevated for a while
- US recovery is going to be a long road back, Fed will need to have a very accommodative monetary policy for a long time
- scenario of a vaccine in the near term and US economy recovering quickly is not one you can put a lot of weight on
- she expects periodic upswings in the virus as time goes on and that fed policymakers have to keep in mind various scenarios
- says longstanding racial and economic disparities are getting worse because of the pandemic
And, of course:
- there is room on the Fed balance sheet to take more action if needed
- not decided if yield curve control benefits exceed the costs
- sees inflation moving lower this year
Official balance sheet policy at the Fed:
