Fed needs to deepen understanding of “full employment” = Boston Fed president | Reuters

[ボストン １７日 ロイター] – Boston Federal Reserve President Collins said on Wednesday that labor supply appears to be improving as the overall labor market tightens, which means the Federal Reserve is less concerned about inflation. , said it could show that the benefits of strong employment can be made to spread to workers.

As in the 2010s, employment continues to expand without increasing wage and other cost pressures due to an unexpected surge in the number of employed people and job seekers. Collins said at the start of a two-day conference on the labor market hosted by the Boston Fed that the Fed must deepen its understanding of these developments as it conducts monetary policy aimed at stable prices and maximum employment.

“There has been a recent move towards a better balance, driven in part by an increase in labor supply. Labor force participation rates for working-age people are currently declining due to the global pandemic caused by the coronavirus. “This is higher than before the pandemic, something that was hardly predicted until a few years ago.” “If the labor supply expands to meet demand when the labor market is tight, even if economic activity picks up further, there will be no additional upward pressure on prices that would necessitate monetary tightening. ” he said.

At the same time, he said the Fed needs to better understand the complexities of assessing “full employment.”

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Covers the US Federal Reserve, monetary policy and the economy, a graduate of the University of Maryland and Johns Hopkins University with previous experience as a foreign correspondent, economics reporter and on the local staff of the Washington Post.