Cleveland Fed Pres. Mester
- With labor market strong, costs of undershooting on policy or prematurely easing still outweigh the costs of overshooting
- Economy does end up in recession in most deflationary periods
- It's more costly to set policy assuming inflation expectations well anchored when they aren't than the other way
- Scenario analysis should play a larger role in policymaking
Mester is a hawk but she isn't pushing too hard here for more hikes, though she certainly sounds open to the idea. The next Fed decision is March 22 and that will come with a new dot plot. There's lots of data to come between now and then.