Fed's Fischer Says Central Bank Policy Cannot Be Rules-based

Mathematical rules to set interest rates can be useful as guides for central bankers but can't be followed blindly, said Federal Reserve Vice Chairman Stanley Fischer on Friday. Policy makers must have freedom to depart from the prescriptions of the rules and even change their assessment of which rule is the appropriate benchmark, Fischer said at a conference sponsored by the Hoover Institution in Stanford, Calif. The House Financial Service Committee passed legislation Thursday to force the Fed to follow a mathematical rule like the one written by Stanford University economist John Taylor. Fischer argued that the Fed's 12-member committee structure removes the need for a rule by bringing many different perspectives to table.