Dallas Fed President Robert Kaplan told CNBC on Wednesday that it is likely appropriate to keep interest rates anchored near zero for up to three years to aid the U.S. economic recovery from the coronavirus pandemic. “I think we’re going to need to keep the Fed funds rate at zero for the next probably 2½ to three years years,” Kaplan said on “The Exchange.” ” It could be that long that until we get on track, to have weathered the crisis and are on track to meet our full employment and price stability goals.” Earlier this month, the Federal Reserve’s policymaking committee voted to keep short-term rates targeted at 0%-0.25%, where they have been for the last six months, and indicated they would remain there until inflation rises consistently. Kaplan was one of two Federal Open Market Committee members to vote against the policy action, but he stressed Wednesday it is due to his desire for the central bank to have more leeway to its monetary approach.
Source: CNBC – Bonds
