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Fed's Mester Says Monetary Policy in Good Place, Would Welcome More Fiscal Aid

   By Michael S. Derby  

Federal Reserve Bank of Cleveland President Loretta Mester said Monday she's happy with the current settings of central bank policy amid the ongoing pandemic, adding she would welcome more economic aid from the government, while noting it's possible for the Fed to do more if needed.

"I'm very comfortable with where policy is now" and "there's more we can do" if the economy needs additional help, Ms. Mester told reporters in a media conference call. "I don't think that we're out of ammunition. I think our tools have been effective so far and I think they're continuing to be effective" in what's has so far been a faster-than-expected economic recovery.

Ms. Mester is a voting member of the rate-setting Federal Open Market Committee. That body met last week and maintained its current policy of near-zero interest rates and asset buying, all of which are being done to help the economy recover from the ongoing impact of the coronavirus pandemic. The Fed is increasingly facing questions about what else it could do to support the economy, as officials' pleas for renewed government aid have thus far gone unheeded by elected officials.

In her comments to reporters, Ms. Mester referred to comments by Fed chairman Jerome Powell after the FOMC that said the Fed has options, most notably in the form of altering its already aggressive course of bond buying. Ms. Mester said that she supports extending central bank emergency lending programs.

And while elected officials have yet to be able to come together to deliver it, Ms. Mester said "further fiscal support would be very welcome," echoing the comments of her colleagues. "We need to have the fiscal support and the monetary policy supporting the recovery," she said.

Write to Michael S. Derby at michael.derby@wsj.com

(END) Dow Jones Newswires

November 09, 2020 18:15 ET (23:15 GMT)

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