Federal Reserve's Moussawi: Inflation risk is surpassing employment risk

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ME News report. On May 7 (UTC+8), St. Louis Federal Reserve President Musalem said there is significant uncertainty about the outlook for the U.S. economy and monetary policy, but he believes that, compared with employment risks, the risks facing inflation are rising. Musalem said on Wednesday: “Inflation is clearly above our 2% target. We face risks on both employment and inflation. Based on my understanding, the risks are tilting more toward inflation rather than employment.” Musalem said the Federal Reserve’s benchmark policy rate is currently at a neutral level that neither stimulates nor restrains the economy, or possibly slightly leans toward easing. He said: “There are very reasonable scenarios that require us to keep the current policy rate unchanged for a period of time.” However, he also noted that he sees some scenarios that may require officials to further cut interest rates or raise them. (Source: Jintou)

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