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Forget low rates! No longer need 'em: KeyCorp CEO

Friday, 11 Oct 2013 | 8:43 AM ET
Mooney: Invest in being productive
Friday, 11 Oct 2013 | 7:46 AM ET
Beth Mooney, CEO, KeyCorp, discusses the importance of American Banker honoring the most powerful women in banking. She says the biggest challenges are finding new revenues and bringing down costs. There's no tail wind in this economy, she says.

A sustained low interest rate environment is not what the U.S. economy needs anymore, KeyCorp CEO Beth Mooney told CNBC on Friday.

"I do think there's a quality and a strength to this economy that just falls short of true growth," she said in a "Squawk Box" interview. "But it is strong. I don't see the downside risks in the economy that I've seen in the prior years."

Mooney has been honored as the most powerful woman in banking by American Banker magazine. She said Janet Yellen—appointed to succeed Ben Bernanke as the first woman to lead the Federal Reserve—was "an unspoken hero at our event last night as the most powerful central banker she will become."

(Read more: Questions Yellen may face for Fed confirmation)

"I think [Yellen] is going to be a continuation of the Fed [current] policy," Mooney observed. "She's obviously been part of the dialogue, part of the debate, and part of the decision-making of the Fed in the last couple of years" as vice chair.

"[But] Bernanke clearly says there will be an exit. I do think very soon, if you ask me to speculate ... we will start tapering," she predicted.

Fed policymakers are set to meet later this month on whether they'll scale back their $85-billion-a-month bond-buying program—a move they declined to do in September, which surprised Wall Street.

The Fed has said that it'll keep its near-zero interest rate policy in tact for the foreseeable future, as it strives to support the economy and spark further job growth.

By CNBC's Matthew J. Belvedere. Follow him on Twitter @Matt_SquawkCNBC.

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