Fed’s Evans says no rate hikes needed before mid-2018

Finance


Daniel Acker | Bloomberg | Getty Images

Charles Evans, president of the U.S. Federal Reserve Bank of Chicago.

Sluggish price increases in America give the Federal Reserve room to hold off on interest rate increases until at least mid-2018, Chicago Federal Reserve President Charles Evans said on Wednesday.

“If we get to that point and have more confidence that inflation is moving up sustainably, then further rate increases would be warranted,” Evans, who does not have a vote on rates this year but participates in the central bank’s policy debates, said in prepared remarks at a banking conference.

Evans did have a vote on policy last year and dissented in the Fed’s decision to raise rates in December because of his concerns over low U.S. inflation rates. Investors expect the Fed will raise rates in March and policymakers in December signaled three hikes would be warranted this year.

On Wednesday, he said he could still support “three or even four” rate increases in 2018 if inflation and other data suggested that would be needed.

The U.S. economy appears to be on solid footing, Evans said, adding that he still expects inflation will hit the Fed’s 2 percent target by the end of 2019 or in 2020.



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