Monetary police is “accommodative and appropriately situated to address the substantial risks that remain both for sluggish economic activity as well as unwelcome inflationary pressures,” Federal Reserve Bank of Chicago president Charles Evans said yesterday.

Reiterating that there is a lag associated with rate cuts having an effect on the economy, Evans said: “It seems likely that credit conditions will also require adjustment time, as financial institutions reevaluate their portfolios and capital needs. As a result, the level of uncertainty regarding future developments continues to be high and the path forward may be uneven. We must keep this in mind as we evaluate the outlook.”

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