Fed’s Mester says policy will stay accommodative

While the “medium” term outlook was more promising, with vaccines likely to help people feel safer doing certain activities, Loretta Mester expects the economy to remain far from the Fed’s inflation and full employment goals.

WASHINGTON: US economic growth could surge later this year if most Americans are vaccinated against the coronavirus, but the gains would unlikely be enough for the Federal Reserve to withdraw its support, according to Cleveland Fed President Loretta Mester.

The economy is likely to struggle in the near term after a rise in coronavirus infections led to more restrictions, both voluntary and mandated, Mester said.