Federal Reserve Vice Chair Philip Jefferson said on Thursday it was appropriate to focus on returning inflation to the central bank’s 2% target given the U.S. labour market has been "very resilient" to the current energy shock.
"When I’m thinking about my policy decision meeting by meeting, I’m absolutely focused on price stability, but by mandate I also need to keep in mind what’s happening in the labour market," Jefferson said during a Q&A session after a speech at a Tokyo conference.
"The U.S. labour market has been very resilient to the current shock. Given that resiliency, it seems appropriate that the focus will be on returning inflation to 2%," he said.
Jefferson’s comments were his first since last Friday’s swearing in of Kevin Warsh as the Fed’s new chair.
Jefferson noted the challenge for the U.S. economy was that aside from the energy shock, expanding AI investment was boosting growth, making monetary policy communication complex.
