Noting that he'd prefer a "sooner rather than later" rate hike, Federal Reserve Bank of Philadelphia President and Chief Executive Officer Patrick T. Harker said Friday hiking rates this year will cut uncertainty and set the economy up for healthy growth.
Long-term growth expectations "remain solid," although medium-term prospects "have been revised downward in recent years," Harker told a policy forum, according to prepared text released by the Fed. With steady, modest growth expected, "I would like to see rates raised sooner rather than later. With an early start, we can better ensure that monetary accommodation is removed gradually and that inflation returns to the Fed's 2 percent target smoothly. My fear is that the Federal Reserve risks losing its credibility and only adds uncertainty to the economic landscape the longer the Committee waits to begin normalizing policy."
"Therefore," he continued, "raising rates this year will, in my view, serve to reduce monetary policy uncertainty and to keep the economy on track for sustained growth with price stability."
