(Bloomberg) -- Federal Reserve Bank of Cleveland President Loretta Mester said she agrees with Fed chair nominee Jerome Powell that the case for a December interest-rate increase is coming together and reiterated the central bank needs to keep tightening gradually to sustain the third-longest U.S. expansion.
“I've been on that case for a while, that we really need to be moving interest rates up gradually, given where the economy is,” she said in an interview Thursday on Bloomberg Television. “Growth is at a sustainable pace. The labor market has continued to improve. Inflation is below our target, no doubt, but it is on a path to moving up gradually to 2 percent.”
Mester said rates have been “very low for quite a while” and monetary policy “has to be preemptive.” The economy has solid momentum going into 2018, she said, though it might be hard to get growth much above 3 percent on a sustainable basis.
Mester, who has led the Cleveland Fed since 2014, is a voting member of the policy-setting Federal Open Market Committee next year.
To contact the reporters on this story: Christopher Condon in Washington at ccondon4@bloomberg.net, Michael McKee in New York at mmckee@bloomberg.net.
To contact the editors responsible for this story: Brendan Murray at brmurray@bloomberg.net, Randall Woods
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