— Says Fed will continue to do asset purchases across the Treasury curve in current economic environment
— Evans watching 10-year yield as an bellwether; accommodative monetary appropriate
— Evans sees U.S. stimulus package as a positive, notes consumer spending strong
— Says current unemployment rate masks those who cannot return to work, but still sees economy strongly rebounding in 2021
By Suzanne Cosgrove
CHICAGO (MaceNews) – Chicago Federal Reserve Bank President Charles Evans Wednesday took an upbeat view of the U.S. economic recovery in 2021, noting that the U.S. stimulus package is a positive and consumer spending is strong.
Asked what economic indicators he follows, Evans cited the 10-year Treasury rate as a bellwether. He added that in the current economic environment, the Fed will continue to do regular asset purchases across the yield curve.
The Fed is constantly monitoring financial risks, he said, and accommodative monetary policy is “appropriate.” He reiterated that the Fed continues to be guided by its dual mandates on employment and a 2 percent inflation goal.
Evans stressed that the Fed’s 2 percent inflation target is an average, and a temporary overshoot even as high as 3 percent “was not a problem.”
He said while the current “headline” employment rate masks the number of people who cannot return to work, that rate still is expected to improve to close to 5 percent by year-end.
Evans is a 2021 voting member of the Federal Open Market Committee, the policymaking arm of the Federal Reserve. He spoke in a virtual webinar hosted by the CFA Society Chicago.
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Contact this reporter: suzanne@macenews.com.
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