The U.S. Federal Reserve should consider lifting interest rates sooner rather than later to tackle speculative bubbles in the housing and stock markets, Nobel Prize-winning economist Robert Shiller told CNBC on Monday.
"I'm thinking they (Fed policy makers) ought to be considering that, because that is the mistake they made in the past," the Yale University professor told CNBC Europe's "Squawk Box" when asked whether he believed the Fed should raise interest rates soon or later on.
"They didn't deal with the housing bubble that led to the present crisis. There's a suggestion in my mind that they should be raising rates now, (but) unfortunately the latest news looks a little weak on the demand side," Shiller added.
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Friday's economic news painted a dim picture for the U.S. economy: gross domestic product declined at a 0.7 percent annual rate in the first quarter of the year compared with an initial estimate of 0.2 percent growth. The University of Michigan's consumer sentiment for May, meanwhile, marked a fall and the May Chicago Purchasing Manager's Index dropped unexpectedly.
Against a weaker tone in economic data, markets have pushed back expectations for the first U.S. rate rise since 2006 from June to later this year.