AGL 38.16 Decreased By ▼ -0.06 (-0.16%)
AIRLINK 134.19 Increased By ▲ 5.22 (4.05%)
BOP 8.85 Increased By ▲ 1.00 (12.74%)
CNERGY 4.69 Increased By ▲ 0.03 (0.64%)
DCL 8.67 Increased By ▲ 0.35 (4.21%)
DFML 39.78 Increased By ▲ 0.84 (2.16%)
DGKC 85.15 Increased By ▲ 3.21 (3.92%)
FCCL 34.90 Increased By ▲ 1.48 (4.43%)
FFBL 75.60 Decreased By ▼ -0.11 (-0.15%)
FFL 12.74 Decreased By ▼ -0.08 (-0.62%)
HUBC 109.45 Decreased By ▼ -0.91 (-0.82%)
HUMNL 14.10 Increased By ▲ 0.09 (0.64%)
KEL 5.40 Increased By ▲ 0.25 (4.85%)
KOSM 7.75 Increased By ▲ 0.08 (1.04%)
MLCF 41.37 Increased By ▲ 1.57 (3.94%)
NBP 69.70 Decreased By ▼ -2.62 (-3.62%)
OGDC 193.62 Increased By ▲ 5.33 (2.83%)
PAEL 26.21 Increased By ▲ 0.58 (2.26%)
PIBTL 7.42 Increased By ▲ 0.05 (0.68%)
PPL 163.85 Increased By ▲ 11.18 (7.32%)
PRL 26.36 Increased By ▲ 0.97 (3.82%)
PTC 19.47 Increased By ▲ 1.77 (10%)
SEARL 84.40 Increased By ▲ 1.98 (2.4%)
TELE 7.99 Increased By ▲ 0.40 (5.27%)
TOMCL 34.05 Increased By ▲ 1.48 (4.54%)
TPLP 8.72 Increased By ▲ 0.30 (3.56%)
TREET 17.18 Increased By ▲ 0.40 (2.38%)
TRG 61.00 Increased By ▲ 4.96 (8.85%)
UNITY 28.96 Increased By ▲ 0.18 (0.63%)
WTL 1.37 Increased By ▲ 0.02 (1.48%)
BR100 10,786 Increased By 127.6 (1.2%)
BR30 32,266 Increased By 934.6 (2.98%)
KSE100 100,083 Increased By 813.5 (0.82%)
KSE30 31,193 Increased By 160.9 (0.52%)

The latest disappointing US jobs number has not changed the overall economic picture and gradual rate hikes remain appropriate, Cleveland Federal Reserve President Loretta Mester said on Saturday. The Fed raised rates in December for the first time in nearly a decade. But further tightening has proven hard to achieve, and most economists now see the next move in September.
"I still believe that in order to achieve our monetary policy goals, a gradual upward pace of the funds rate is appropriate," Mester, a voting member on Fed policy this year, told reporters in the Swedish capital. "The timing of actually when the rate hikes would occur and the slope of that gradual path is data-dependent." Fed policy-makers next meet on June 14-15 to decide on rates.
The US economy added just 38,000 jobs in May, well below the consensus estimate of 164,000 and the smallest gain since September 2010. "You can't read too much into one number, but it is certainly part of the data that will be taken into account as we go into the June FOMC meeting and for the rest of the year," Mester said. "I think that the weak employment number has not changed fundamentally my economic outlook."
In a speech, Mester also weighed in to the debate about the role of monetary policy in heading off financial imbalances saying the Fed should only resort to using interest rates if other more precise tools fail. "If our macro prudential tools proved to be inadequate and financial stability risks continued to grow, I believe monetary policy should be on the table as a possible defense," she said.
As the Fed approaches a potential rate hike as soon as this summer, one reason to act sooner than later is to head off any brewing instabilities in risky corners of financial markets such as commercial real estate, where high valuations have attracted some recent concern. So far the Fed's approach has been to use financial regulations and supervision of banks and other firms - so-called macro prudential tools - to head off any emerging risks. "Financial stability should not be added as a third objective for monetary policy," said Mester.

Copyright Reuters, 2016

Comments

Comments are closed.