November 15, 2017 / 10:24 AM / 2 years ago

Fed's Evans will go into December meeting with open mind

LONDON (Reuters) - Federal Reserve policymaker Charles Evans said he will go with an open mind into next month’s policy meeting, at which the U.S. central bank is expected to raise interest rates for a third time this year.

Federal Reserve Bank of Chicago President Charles Evans participates in a moderated discussion in Zurich, Switzerland October 11, 2017. REUTERS/Arnd Wiegmann

Speaking to reporters on Wednesday, Evans, who heads the Federal Reserve Bank of Chicago, said the pick-up in global growth was making life easier for central bankers but that the number of vacant positions on the Fed’s board was “very challenging”.

“You go into December and you all have a discussion and you make a decision,” Evans said on next month’s meeting.

“I have argued that I think we still have a ways to go with respect to inflation. I am optimistic that the state of the economy is strong and that’s going to help move inflation in the right direction but I think we will continue to need accommodative policy.”

But the improving economic backdrop was helpful, he said: “From the U.S. perspective I find it extremely supportive that the global economy has improved and that makes all of our jobs easier.”

Evans said earlier said in a speech that he was worried about a drop in U.S. inflation expectations, and called for the central bank to respond by flagging the likelihood of higher inflation ahead. [nL1N1NK2M8]

In Frankfurt on Tuesday he also became the second Fed policymaker in recent days to call for a broader approach to rate-setting. [nB9N1E70AO]

Noting the challenges facing the Fed due to the vacant or soon-to-be vacant policymakers’ seats, Evans added: “It’s very useful to have a full complement of governors and I look forward to the President appointing continued very good Governors — all seven of them.”

On how long it might take to appoint the full board, Evans said: “I can’t guess, I have no idea. That’s a political question.”

He said he expected Jerome Powell’s experience on the current Fed board to set him up well when he takes over from Janet Yellen as chair of the central bank in February.

Reporting by Marc Jones and Helen Reid; Editing by Catherine Evans

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