Sandra Pianalto, president of the Federal Reserve Bank of Cleveland, said today that it is her belief that the Fed’s “accommodative monetary policy has put the economy on a path, albeit gradual, that will achieve our maximum employment objective while maintaining price stability.” That does not mean that she thinks the Fed should change course any time soon however:
Trying to accelerate the pace of economic growth by easing monetary conditions further could put the Committee’s price stability objective at risk. Alternatively, removing policy accommodation prematurely could risk breaking the momentum of the expansion and causing disinflation. With my current outlook, I think our policy stance is still the one best suited to foster steady gains in output and employment and to maintain stable prices.
Pianalto is a voting member of the Federal Open Market Committee, so her view of Fed policy carries substantial weight. Her remarks indicate that she remains firmly in the Bernanke camp.
The full text of her remarks is available here.