YEREVAN, March 24. /ARKA/. The U.S. economy is strengthening and an interest rate increase in June remains a possibility, Federal Reserve Bank of Cleveland President Loretta Mester said in an interview on Bloomberg Television in Paris on Monday.
She was quoted by vestifinance.ru as saying in her interview that the current weakness in the economy is “transitory” and she’s “more optimistic” about the outlook.
“The headwinds we have been suffering through are abating, financially both consumers and business balance sheets look good, banks are recapitalized,” she said. “So I see some strength of the economy.”
Policy makers last week opened the door to a rate rise as soon as June when they dropped an assurance to be “patient” in raising rates, while also indicating in their forecasts they will tighten policy slowly once they get started.
Mester said the Fed’s removal of “patient” from its recent statement means “June is a viable option” for tightening.
“It would be appropriate to raise interest rates sometime this year,” said Mester, who votes on the Federal Open Market Committee next year. “We are not going to necessarily move in June but it gives us June as a viable option.”
Asked about the dollar, she said it reflects the fact that the U.S. “is relatively stronger than other countries.” She also said it will curb exports, which will be a negative for expansion in 2015. –0–
