The President and Chief Executive Officer of the Federal Reserve Bank of Cleveland, Loretta J. Mester, spoke at the Akron Roundtable Signature Series on April 20th, highlighting the progress made in the economy but cautioning that inflation remains stubbornly high.
Mester noted that the Federal Reserve has significantly tightened monetary policy over the last year, resulting in progress being made in balancing supply and demand in product and labor markets, as well as reducing inflation. However, she warned that inflation remains too high and urged prudence in assessing incoming economic and financial information to determine the appropriate path of monetary policy going forward.
The Cleveland Fed President stated, "Given that some of the increases in rates and tightening in financial conditions have yet to be felt in the economy, we need to be prudent in assessing all of the incoming economic and financial information when determining the appropriate path of monetary policy going forward."
In her speech, Mester also discussed the outlook for Ohio's economy, which she expects to follow similar trends as the national economy. She pointed out that Ohio's economy has been diversifying from its traditional dependence on manufacturing and heavy industry to sectors such as healthcare and education.
Despite the progress made in reducing inflation, Mester emphasized that the job is not done. She quoted former Fed Chair Paul Volcker, saying, "...failure to carry through now in the fight on inflation will only make any subsequent effort more difficult, at much greater risk to the economy."
