The Federal Reserve has been laboring to beef up the economy and now that there are signs the recovery is strengthening, the Fed needs to stay on course, according to William Dudley, president and chief executive officer of the Federal Reserve Bank of New York.
“It is important to emphasize that we at the Federal Reserve have been expecting the economy to strengthen,” Dudley told the Queens, N.Y., Chamber of Commerce Friday morning, according to a prepared text of his remarks released by the Fed. “A stronger recovery with more rapid progress toward our dual-mandate objectives is what we have been seeking. This is welcome and not a reason to reverse course.”
The economy is not out of the woods yet, he warned. “The coast is not completely clear — the healing process in the aftermath of the crisis takes time and there are still several areas of vulnerability and weakness,” Dudley said.
He also cited the possibility of further shocks from abroad. “For example, higher oil prices cut into household purchasing power, and the situation in the Middle East and Africa remains uncertain and dynamic,” he said.
