THE BASIS POINT

Philly Fed President Charles Plosser: Inflation Crusader

 

Charles Plosser, Philadelphia Fed president and voting member of the Federal Open Market Committee that sets benchmark rates, has spoken publicly twice since CPI and PPI came out last week. He’s a well-known inflation hawk, having dissented on the April 30 quarter-point cut and the March 18 three-quarter point cut, and he voted on June 25 to halt the Fed Funds Rate at 2% after seven cuts since October 2007. Yet markets still react to his expected hawkishness.

His most recent comments yesterday were after the Fed’s Beige Book report showed basically flat economic activity. Plosser does not seem to think rate hikes should wait until the housing crisis is over, but rather hike rates now before inflation creeps further into the economy. He’s right in a way, but his position relative to Bernanke’s wait-and-see approach on economic weakness is the harsher approach. This story has more details on Plosser’s positions.

 

WANT TO OUTSMART YOUR FRIENDS?

GET OUR NEWSLETTER

Comments [ 0 ]

WHAT DID WE MISS? COMMENT BELOW.

All comments reviewed before publishing.

5 × 3 =

x