The economy is in a recovery that should be sustainable, even with stimulus programs beginning to be wound down, Federal Reserve Bank of Philadelphia president and chief executive officer Charles I. Plosser said yesterday, adding that the federal funds rate should be allowed to rise as real interest rates grow.

But not all is rosy. “Uncertainty still looms large,” Plosser told the 31st Annual Economic Seminar in Rochester, N.Y., according to prepared text released by the Fed.

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