LAS CRUCES, New-Mexico (Reuters) - remains of while Inflation under control, despite the high prices of oil, but the Federal Reserve stands ready to increase interest rates if the price pressures seem to be getting of at the outset, the Fed officials said Wednesday.
In his first speech as President of the San Francisco Fed, John Williams, was argued that soaring commodity costs will be probably transient.
"The economy is now facing numerous difficulties, but I do not believe that hyperinflation is one of them," said Williams, adding that it would not prejudice a possible need for additional bonds purchases in the future.
In response to evidence of economic weakness last summer, the US Central Bank in November announced that it would buy $ 600 billion in Treasury bonds to reduce borrowing costs in the long term and support the recovery.
In some of the first public speeches by Fed officials since a political meeting from April 26-27, in which the Central Bank said that it would complement these purchases on schedule at the end of June, decision makers who spoke Wednesday explained why they are in no rush to pull back ultra-loose political currency soon.
Eric Rosengren, Dove President of the Boston Fed, who is a voter this year on the Federal Committee of market freedom of establishment of policies, many struck the same note: Williams, saying that a return to inflation in the years 1970-style was not likely.
He said that tame wage growth and high unemployment help cushion some of the inflationary impact of food and energy higher, keeping the consumer inflation expectations under control.
An increase in inflation expectations can be self-fulfilling if it leads workers to demand higher wages.
But with high unemployment rates, workers have little power to demand wages more high because they can be easily replaced.
MARKET OF THE HEALING WORK SLOWLY
Another official of the U.S. Central Bank, Atlanta Fed President Dennis Lockhart, has experienced a growth in employment stable but modest about 200,000 jobs a month through the rest of this year after a slow period.
"It may take three years before the size of the market for the work of the country reached prerecessionary levels," he said in a speech in Atlanta.
The Department of the work of the United States will report figures for non-agricultural in April payrolls Friday. Economists expect that 186 000 jobs have been added in April, a Reuters poll.
Rosengren said of increases in inflation in the overall U.S. due to shock of offer since the mid-1980s were generally temporary, a model that should play again.
"We should the impact on inflation to be transient - and that total inflation converge on core inflation, which remains well below 2 percent," he said.
The U.S. consumer price index jumped 2.7% in the year to March. But the so-called core CPI, which excludes the cost of food and energy more volatile and is an indicator of the underlying price trends, rose by only 1.2%. The Fed informal target is 2%.
Not all the Fed officials are all also optimistic on inflation. Richard Fisher, President of warmongering Dallas and also an elector FOMC fed this year, cited concerns over the rise in the price.
"The number overall (inflation) have got a little stout," he told reporters after a speech. "We must carefully watch" how to change inflation expectations.
However, it stops far the appellant to increases in short-term interest rates.
And Lockhart, the Atlanta Fed, said no monetary policy tightening is imminent.
"It's a little premature now to anticipate that it will happen immediately," he said.
The sequence and pace of the actions the Fed when it is time to return on its easy money policy will depend on economic conditions at the time, said Lockhart.
READY TO FIGHT INFLATION
If inflation starts to act, officials have said that the Fed has the tools and the desire to address the threats of price by quickly bringing interest rates.
"I am determined to respond decisively and as with force as necessary", Rosengren the Boston Fed said, "to ensure that long-term inflation expectations remain stable and that food and energy prices are not passing through other awards".
In response to the worst recession in generations, the Fed reduced the official borrowing costs to effectively zero and put in place an array of unorthodox to heal the credit markets frozen loan facilities. Many of these measures were a component such as the improvement of the conditions of the market, but buying controversial asset to reduce long-term rates continued.
"If it is necessary to inflationary pressure meter, I will be among the first to defend the conduct of a part of the stimulus that we provided," said Fisher.
Fisher cited repeated orders manufacturing and capital goods as not only an indicator short term positive economic momentum, but also potentially a sign that the US economy has finally been away an undue on consumer spending.
"They are precursors to necessary rebalancing," he said.
(Additional reporting by Ros Krasny to Boston, Ann Saphir in Los Angeles, and Joe Rauch Atlanta; additional writing by Mark Felsenthal.) (Editing by Leslie Adler)
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