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Fedspeak: Ferguson Sees More Room For Rate Cuts

Remarks today by Federal Reserve Vice Chairman Roger W. Ferguson, Jr., were clearly intended to leave room for further rate cut action.
Ed ZwirnApril 19, 2001

The Federal Reserve remains open to further rate cuts and retains its bias toward stimulating the economy, Fed Vice Chairman Roger W. Ferguson, Jr. told a meeting of the National Economists Club and Society of Government Economists today in Washington, D.C.

“There is more than the usual amount of uncertainty at this juncture about the economic future,” Ferguson said as part of his address on “Transparency in Central Banking: Rationale and Recent Developments.”

“Since late last year, evidence has accumulated that the economy would be unlikely to meet the Committee’s goal of maximum sustainable noninflationary growth,” he said explaining the FOMC’s rationale in moving “aggressively, cutting the federal funds rate 200 basis points since the turn of the year.”

“But what interest rates will be associated a return to healthy growth in spending remains an open question,” he said. “As the FOMC noted yesterday, the risks remain toward economic weakness.”

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