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Fed’s Mester Says Monetary and Fiscal Support Needed to Avoid Lasting Economic Damage – CVBJ – Latest News, Breaking News, Top News Headlines

By Jonnelle Marte

Jan 12 (.) – The U.S. economy will continue to need support from monetary and fiscal policy as it recovers from the crisis caused by the pandemic and overcomes the challenges caused by an increase in infections, the president of the United States said on Tuesday. the Cleveland Federal Reserve, Loretta Mester.

“Both monetary and fiscal policy have supported the recovery in the United States so far, and in my opinion, both will continue to be necessary to limit lasting damage to the economy from the pandemic,” Mester said in remarks prepared for an event organized by the European Center for Economics and Finance.

The arrival of effective vaccines and some stronger-than-expected improvements suggest that the economy is more resilient than initially thought, Mester said.

He also reiterated his view that no changes in monetary policy will be needed if the economy slows down in the first half of the year and then recovers in the second half, as expected.

However, he also highlighted that the economic outlook remains very uncertain and said that the Fed authorities are ready to tighten monetary policy if the result is worse – or better – than expected.

“In any event, in accordance with our future guidance, the Federal Reserve authorities are prepared to respond appropriately and continue to foster a broad-based sustainable recovery,” Mester said.

(Edited in Spanish by Carlos Serrano)

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