HOUSTON (Reuters) - U.S. economic growth is softening amid still fragile financial markets, but it is not clear that this will curb inflation as hoped, a top Federal Reserve official said on Thursday."While it seems pretty clear that economic momentum is slowing, the jury is out on whether lesser momentum will be sufficient to translate into relief on the price front over the intermediate to longer term," Dallas Federal Reserve Bank President Richard Fisher told a business luncheon.
"It is pretty clear that trend consumer price inflation has accelerated over the past few months," said Fisher, who has voted against interest rate cuts or in favor of monetary policy tightening at every Fed rate-setting meeting this year.
Despite Fisher's concern over inflation, the U.S. central bank is expected to hold benchmark overnight rates steady at 2 percent at its next policy meeting on September 16.
Read More
