(Reuters) – There is no barrier to the U.S. Federal Reserve hiking interest rates and beginning to reduce its balance sheet at the same policy meeting, Cleveland Federal Reserve Bank President Loretta Mester said on Wednesday.
“I think given the situation we’re in and the communications that Chair Powell has already made about the balance sheet process, I don’t have concerns that that would be destabilizing and I think that we have to recognize inflation is very elevated,” Mester said in a call with reporters. “We have to do what we can with both our policy tools to get inflation under control.”
Mester also repeated comments made on Tuesday that she favors frontloading interest rate rises in the first half of this year and sees some half percentage point hikes.
(Reporting by Lindsay Dunsmuir; Editing by Franklin Paul)
