Improvement in the job market and stable inflation suggest that "modestly higher" short-term interest rates are appropriate, Kansas City Fed President Esther George said Thursday. "Economic trends and experience suggest...we would be wise to act modestly but act now," George said in a speech in Stillwater, Okla. While there are pockets of the labor market that continue to struggle, productivity is low and global concerns can pose risks, "monetary policy is not the proper tool to address all of these issues," George said. Low rates can result in the "mispricing of risk and financial assets," said George, who will be a voter member of the Fed policy committee next year.
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