Fed's Evans Says Leaning Against December Interest Rate Hike

Chicago Fed President Charles Evans said Tuesday that he is leaning against supporting an interest rate hike at the policy meeting later this month. "Before raising rates, I would prefer to have more confidence than I do today that inflation is indeed beginning to head higher," Evans said in a speech in Lansing, Mich. Evans, a voting member this year and a leading dove on the central bank, said he is nervous about the upcoming December decision. When the Fed decides to move rates up, it is "vital" that the U.S. central bank "strongly and effectively communicates its plan for a gradual path for future rate increases," Evans said. Without such a statement, the market might think the Fed is inclined not to keep rates low, he said. "I would view this as an important policy error," he added. The Chicago Fed president said he thinks the Fed should hike slowly, with rates still below 1% at the end of 2016.

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