Top US Fed official downplays inflation, warns against acting early
WASHINGTON (AFP) - The current spike in inflation is unlikely to pose a persistent threat to the US economy, and prematurely heeding calls to act could derail the recovery from the Covid-19 downturn, a top Federal Reserve official said Wednesday. Fed Vice Chair Randal Quarles also said he is optimistic about the country's growth prospects and economic outlook thanks to a stockpile of consumer savings that will boost spending. But policymakers will "remain patient" before tapping the breaks on stimulative policies, to ensure jobs recover and return to what the central bank considers full employment, Quarles said in a speech to The Brookings Institution. The Fed has pledged to keep the benchmark lending rate at zero and continue its massive bond buying program until unemployment comes down from the current 6.1 per cent and inflation is on track to stay above 2.0 per cent. But some economists are wary the US central bank is getting behind the curve as a key inflation index hit 2.3 per cent in March. Quarles underlined the Fed's view that most of factors causing prices to rise are temporary. "I expect inflation to begin subsiding at some point over the next several months and to be run...
