WASHINGTON (Reuters) – The U.S. Federal Reserve can curb an outbreak of inflation should it occur without throwing the recovery off track, Fed vice chair Richard Clarida said on Tuesday, voicing faith in the central bank’s ability to engineer a “soft landing” if prices continue to escalate beyond what is expected.
The Fed feels the current rise in prices will ease on its own as the economy reopens, but “in the risk case where these pressures are more persistent and they put our price stability mandate at risk, we will recognize that and through our communications and our tools I think we will be able to offset that in a way that would be supportive of maintaining economic recovery,” Clarida said on Yahoo Finance.
(Reporting by Howard Schneider)
