Fed's Evans said rates may need to be more restrictive in years to come
Fed's Evans said rates may need to be more restrictive in years to come, in comments to reporters in a media briefing. The long-time dove who's been worried about low inflation said the price environment is still a bit below what he'd like, but now believes the stronger economy may help boost inflation expectations. Though the tariff situation is increasing uncertainty, it's occurring at a time when the "economy is doing very strongly and the labor market continues to improve." The unemployment rate could fall to 3.5% by the end of 2020, and if inflation holds around 2.2%, that "suggests only a modest amount of restrictiveness above our neutral rate might be called for in 2020." His forecast for the neutral rate is 2.75%, and said he could see the FOMC pushing rates to 3.25%. Evans is not a voter this year.