Loretta J. Mester

President, Federal Reserve Bank of Cleveland


Joined the Federal Reserve: June 1, 2014


Summary Lean Statement Date Publication Date
1  Fed's Mester Says Gradual Rate Hikes Still Right Call for 2016: "Federal Reserve Bank of Cleveland President Loretta Mester said fundamentals underlying the U.S. economy remain strong and the central bank should stay on track for a gradual tightening of monetary policy this year. “Whether we increase in March or not, that’s going to depend on the data and other people’s views around the table,” Mester said in an interview late Thursday in New York. “But my forecasts, and the risks around those forecasts, suggest we still want to see gradually rising interest rates.”" Hawkish February 25, 2016 February 26, 2016
2  Fed's Mester upbeat on inflation, path of tightening: "Improving U.S inflation data and underlying strength in the economy should keep the Federal Reserve on track to gradually raise interest rates, Cleveland Federal Reserve President Loretta Mester said on Friday. "My feeling is the path of interest rates to support the economy is going to be still one where we gradually reduce the amount of accommodation," Mester told reporters following a speech at a Global Interdependence Center event in Sarasota, Florida." Hawkish February 19, 2016 February 19, 2016
3  The Economy and Monetary Policy: "Given my outlook that the economy will work through this rough patch and resume a trajectory of moderate growth, with continued improvement in labor markets and a gradual return of inflation to 2 percent, I believe the appropriate policy path will involve gradual reductions over time in the extraordinary level of accommodation that was necessary to address the Great Recession. Even as policy gradually normalizes, it will likely need to remain accommodative for some time to come, given some of the forces still impacting our economy — for example, slow growth abroad, dollar appreciation, more restrictive financial conditions, and the continued rebalancing of supply and demand in the energy sector." Neutral February 19, 2016 February 19, 2016
4  A Monetary Policymaker's Lexicon: "While the actual path the fed funds rate follows will depend on the economic outlook, and thus, will be data dependent, my current view is that economic conditions will evolve in a way that will warrant rates moving up gradually over time to more normal levels." Hawkish February 4, 2016 February 4, 2016
5  Fed's Mester Shrugs Off Stocks Drop and Says U.S. Economy Sound: "“Underlying fundamentals of the U.S. economy remain very sound,” Mester said Monday in an interview on Bloomberg Television. “There’s going to be volatility in the markets, that’s kind of the nature of financial markets.”... Mester said a weakening economy in China had already been built into the outlook for 2016 by Fed officials... “I don’t see that as a significant risk for the forecast,” she said." Hawkish January 4, 2016 January 4, 2016
6  The U.S. Economy and Monetary Policy: "In summary, the economy has made substantial progress toward the Fed’s goals of maximum employment and price stability – enough progress that in December the FOMC moved its target federal funds rate up by 25 basis points from essentially zero, where it had stood for 7 years. Even with this increase, monetary policy is expected to remain accommodative for some time to come and will continue to support the expansion." Neutral January 3, 2016 January 3, 2016
7  Fed's Mester prefers a bit quicker U.S. rate-hike pace: "Loretta Mester, president of the Cleveland Fed, told Reuters in an interview she does not need to see clear evidence of inflation to back more policy tightening after an initial rate hike in mid-December. The Fed could act at any policy meeting, including one later in January, she said. After lifting rates for the first time in nearly a decade, the Fed said further moves would be gradual and dependent on how the world's top economy performs. The central bank last month forecasted four rate hikes in 2016, based on the median projection of its 17 top officials... "I'm probably a little steeper than that in the near term, just because I have a higher growth forecast."" Hawkish January 3, 2016 January 3, 2016
8  Top Fed official: The economy can handle a rate increase: "We have about two weeks to go. We’re going to of course look at the data that comes in over those two weeks. But my read of the data is consistent with what I send in my speech a few weeks ago: The economy can handle an increase in interest rates." (It is not clear on which date the interview actually took place.) Hawkish December 4, 2015 December 4, 2015
9  Fed's Mester: Policymakers aren't boxed in on rates: "While the Federal Reserve has been telegraphing the possibility of an interest rate increase next month, Cleveland Fed President Loretta Mester said Thursday policymakers are not boxed in to move. But she said, "Things are on track." Appearing on CNBC's "Squawk Box," Mester said the Fed is trying to be as transparent as it can about the option to hike rates if economic conditions warrant an increase. She believes the economy can absorb the first rate hike in nine years." Hawkish November 19, 2015 November 19, 2015
10  Lockhart, Dudley, Mester Discuss Economy, Fed Policy: "My own view is, looking at the data we've received so far, is that yes, I think the economy can handle a 25-basis point increase." (45:45 in the video) Hawkish November 18, 2015 November 18, 2015
11  Perspectives on the Economy and Monetary Policy: "In summary, the economy has made considerable progress over the expansion and my medium-run outlook is for above-trend growth, continued improvement in labor markets, and inflation gradually returning to our 2 percent target over the medium run. If incoming economic information continues to support this forecast, then in my view it will be time to take the first step in the policy normalization process." Hawkish November 13, 2015 November 13, 2015
12  Fed’s Mester: I think the economy can handle a rate increase: "I can say that I think the economy can handle a rate increase." Hawkish October 16, 2015 October 16, 2015
13  Long-Run Economic Growth: "Based on my current assessment of the outlook and the risks around the outlook, I believe the economy can handle an increase in the fed funds rate and that it is appropriate for monetary policy to take a step back from the emergency measure of zero interest rates. A small increase in interest rates from zero is not tight monetary policy." Hawkish October 15, 2015 October 15, 2015
14  US 'can handle' rate hike this year: Cleveland Fed chief: "I cannot comment on other people, but personally, when I look at the economy today, I think we can handle an increase in interest rates. But we're going to be assessing the incoming data over the time." (Interview was published on 9/29, but it is unclear if it was actually conducted that same day.) Hawkish September 29, 2015 September 29, 2015
15  Fed: "Si los tipos son bajos largo tiempo se corren graves riesgos para la economía:" "From my point of view, one of the criteria for the rate hike has already been fulfilled. The other condition is inflation and I am confident that it will eventually reach 2 percent in the medium term." (Comment translated from Spanish via Google Translate. The interview was published on 9/25, but it is unclear when it actually took place.) Hawkish September 25, 2015 September 25, 2015
16  The Fed has met the criteria for a rate rise: ""When I think of the criteria the FOMC has set for lift-off, I am pretty confident that we have met those criteria," Mester said in an exclusive interview with Business Spectator." (The interview was published on 9/24, but it is unclear when it actually took place.) Hawkish September 24, 2015 September 24, 2015
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