The economy should grow at slightly above 3% a year as the recovery strengthens, and the recent price spike in commodities and energy that are exerting upward pressure on inflation should be transitory, according to Sandra Pianalto, president and chief executive of the Federal Reserve Bank of Cleveland.

The recovery has been “gradual and bumpy,” but now “rising incomes and rising profits are supporting growth in retail sales and business demand, which in turn fuels more growth in incomes and profits,” Pianalto told a University of Akron alumni panel, according to prepared text of her remarks released by the Fed.

Subscribe Now

Independent and authoritative analysis and perspective for the bond buying industry.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.