Loretta Mester, President and Chief Executive Officer of the Federal Reserve Bank of Cleveland

  • monetary policy will need to remain highly accommodative for 'quite some time'
  • says economy's dynamics suggest inflation is not going to move up quickly above 2%
  • expects a strong pickup in economic activity in H2 of 2021, assuming most people are vaccinated by Q3
  • says stronger growth this year would not require change in policy because she expects economy will still be far from Fed's employment and inflation goals


I suspect the dynamics are in place for a temporary blip higher in inflation in coming months, but it'll likely be temporary only and Mester is right .... policy to remain loose for a good while yet.