Monetary policy should be set by a series of well-crafted rules, Federal Reserve Bank of Philadelphia president and chief executive officer Charles I. Plosser said yesterday.

“I am in favor of a systematic, rule-based approach to monetary policy, primarily because it limits discretion and improves economic stability by reducing policy uncertainty,” Plosser told the European Banking and Financial Forum, according to prepared text of his remarks released by the Fed.

“But I will argue that choosing the particular form of the rule must be done with great care, because many of the economic variables that could be used in setting policy are in fact poorly measured,” he said.

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