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Charles Evans says "open-minded" about the right amount of Fed rate



Charles Evans, president and chief executive officer of the Federal Reserve Bank of Chicago, told CNBC Monday that he was "open-minded" when asked about US interest rates, but suggested further cuts when the headwinds hit increases.

Evans, known for his restrained attitude towards the central bank, was still optimistic about US fundamentals despite the economic headwinds.

"We have lowered the federal funds target by 50 basis points, and I think that has helped us to have an accommodative attitude, more than we were sure of, but that could be a moving target as the headwind increases and we may do more ", said Annette Weisbach of CNBC in Frankfurt.

that he was "definitely open-minded," which would be the right level for federal interest rates to have the "appropriate monetary policy."

"At the moment, I think that adequate monetary policy is a little below neutral levels," he said.

Charles Evans, President of the Federal Reserve Bank of Chicago

Daniel Acker | Bloomberg | Getty Images

"In the past six months, we have had more problems bringing inflation to 2%, there is more uncertainty, trade negotiations have been challenging, growth in Europe and China has slowed down, so it seems a more accommodating stance to be." A good thing for the US, "he added.

" What we've already done could be enough. I am open to suggestions that may need more. At the moment, I'm going to look at that data, "he said, and specified inflation and labor market data as key metrics.

Evans's comments came after the US Federal Reserve approved a rate cut a quarter point earlier in September, but only There was little evidence for further reductions Individual decision makers were divided over what to do next.

In July, Evans said a few rate cuts were needed to bring the inflation rate close to 2%. The Fed has since lowered its key interest rates in July and September, a drop of 50 basis points this year, with annual inflation currently at 1.7%.

Regarding the US economy and From their headwinds, Evans added that the country "may be able to reverse the uncertainties.

"There could be more fragility and when there's a shock That's totally unexpected and something we have not thought about yet, which could lead to something not so very positive," he told CNBC.


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