Cleveland Fed’s Mester: U.S. economic expansion, strong job market will continue

Cleveland Fed president, Loretta Mester, expressed optimism that the current economic expansion and strong job market in the U.S. will continue despite the tighter monetary policy.

She explained in an interview on CBS: “Inflation will remain high through 2023 even as the Fed moves steadily to lower the pace of price increases.”

“Fed interest rate hikes will help reduce demand and decrease inflationary pressures to the central bank’s target at 2%”, Mester added.

It is noteworthy that the Fed is planning a steady series of interest rate hikes in 2022 besides expected reduction of its Treasury bond holdings and mortgage-backed securities.