Is The Fed Too Focused on Inflation? Economists Split
The Federal Reserve’s two-day meeting on interest rates, inflation and the economy started Wednesday. Is the Fed overly concerned with inflation? Carl Tannenbaum, chief economist at LaSalle Bank, and Paul Kasriel, senior vice president and director of economic research at Northern Trust Company, offered their insights on “Morning Call.”
Tannenbaum believes that this is not a time to be relaxed, citing a long list of existing inflation risks.
“We have a tight labor market, we have productivity growth that seems to be moderating, and we have import prices that are going up, so certainly it’s no time to discard the vigilance that they [the Fed] have expressed in their statements over the last few months,” Tannenbaum told CNBC’s Mark Haines.
But Kasriel believes that, if anything, there will be more concern about recession than inflation by late October.
“Right now everything is moving according to the Fed’s forecasts and that is how they’re basing their policy, so I do not expect to see any major change,” said Kasriel.