“I am in the camp that believes it will soon be time to begin slowly and methodically — frankly, boringly — tapering our $120 billion in monthly purchases of Treasury bills and mortgage-backed securities,” Harker said in remarks prepared for a virtual event.
Harker said he expects the U.S. economy to grow by about 6.5% in 2021 and then for growth to “moderate” to about 3.5% in 2022.
The Fed official said he expects inflation to be around 4% for 2021 before it comes down to just over 2% for 2022. “We’re already seeing some moderation there, as prices of used cars finally stabilize,” Harker said.
He also warned about the negative economic consequences in the short term if Congress fails to raise the debt ceiling, saying it “could harm economic growth significantly.”
Harker will vote as an alternate in the Fed’s monetary policy meetings next year until a replacement is chosen for Boston Fed President Eric Rosengren, who announced earlier this week that he is retiring on Thursday.
Rosengren cited health reasons for his decision and was also facing questions about investment trades he made in 2020 while the Fed took actions to stabilize financial markets and the economy.
Source: Economy - investing.com
