BLOOMINGTON, Minn. Oct 4 The Federal Reserve
should do "whatever it takes" to drive down U.S. unemployment,
even if this means courting concerns of another asset price
bubble, or inflation than pops temporarily above its two percent
goal, a senior U.S. central banker said on Friday.
"The labor market remains disturbingly weak. The good news
is that, with low inflation, the FOMC has considerable monetary
policy capacity at its disposal with which to address this
problem," said Minneapolis Fed President Narayana Kocherlakota,
referring to the policy-setting Federal Open Market Committee.
His comments closely followed a speech he gave last week.
"Doing whatever it takes will mean keeping a historically
unusual amount of monetary stimulus in place - and possibly
providing more stimulus," he said in prepared remarks.
Kocherlakota added that this would be the case "even as"
rising asset prices courted concerns of another bubble, or the
medium term outlook for inflation rose above 2 percent, the
Fed's stated goal.
"It may not be easy to stick to this path. But I anticipate
that the benefits of doing so, in terms of employment gains,
will be significant," he said.