The Federal Reserve should be aggressive in acting to cut the jobless rate, Boston Federal Reserve president Eric Rosengren told educators Monday.
“Given the very weak labor market conditions and the low expected inflation rate, the Federal Reserve should in my view continue to take action to aggressively try to reduce the stubbornly high U.S. unemployment rate,” Rosengren said, according to a prepared text of his speech released by the Fed.
Rosengren predicted inflation will remain below 2% “the next several years,” since labor markets remain “very weak.”
“But clearly the Federal Reserve cannot do it alone. Given the sobering macroeconomic situation, it is important that fiscal policy, controlled by the federal government and the states, do its part,” he said. “It is also important for international policymakers to take actions that provide more stable world markets.
“But at the same time, in my view the Federal Reserve should continue to use the tools at its disposal to boost demand in the economy. And at the same time, we would do well to work on addressing any impediments to students getting the employment opportunities that will serve them, their communities, and the macroeconomy.”