Fed's George Supports Mid-year Rate Hike

Kansas City Fed President Esther George said she would support a decision to hike short-term interest rates in mid-year. "While the FOMC has made no decisions about the timing of this action, I continue to support liftoff towards the middle of the year due to improvement in the labor market, expectations of firmer inflation, and the balance of risks over the medium and longer run," George said in a speech Wednesday at the Central Exchange in Kansas City. George, one of the more hawkish Fed regional bank presidents, has been pressing for the Fed to return to a more normal monetary policy since the fall of 2013. George, who is not a voting member of the Fed's policy committee, said waiting until the Fed had met its twin goals of full employment and 2% inflation would put policy "behind the curve and require rates to rise rapidly in the future." Moving sooner would allow subsequent rate hikes to come at a "gradual pace," she said.