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Fed's Evans says wanted to wait until midyear for rate hike


(Reuters) - Federal Reserve Charles on Wednesday said that in late 2017 when the rest of his colleagues decided to raise for a third time, he wanted to wait until mid-2018.

While most of his colleagues believe that a strengthening labor market will boost inflation this year, justifying higher interest rates, said he has seen that forecast for several years running and it has not panned out.

"I'd feel a lot more confident if I saw those transitory reductions in the inflation rate go away," he said in his first public remarks of 2018.

He added that he expects the U.S. economy to grow a touch faster than 2.5 percent this year, helped by recent tax cuts, and a touch slower than 2.5 percent next year, which is faster than trend growth and should allow the labor market to continue to strengthen.

Still, he said, "I do not yet think that we have gotten to a point where we have overshot" on full employment, he added, saying that wage growth would be faster if it had.

And, he said, he does not see much risk that the economy will accelerate faster than he is forecasting. If it does, he said, and inflation picks up, the is able to deal with that problem by raising rates. But if inflation worsens with rates as low as they are, he said, the has to deliver stimulus.

does not have a vote on the Fed's monetary policy-setting committee this year but takes part in its meetings, the next of which is to take place in late January.

(Reporting by Ann Saphir; Editing by Chizu Nomiyama)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Wed, January 10 2018. 20:24 IST