Zero rate policy has costs – Fed’s Kaplan

FXStreet (Edinburgh) - Dallas Fed President Robert Kaplan has argued that 3-4 rate hikes is a ‘reasonable base case’ for the current year, adding that it is still premature to say how much the Fed will raise rates.

Kaplan expects the US economy to expand 2-2.5% this year and the unemployment rate to keep receding. Regarding inflation, he stressed that consumer prices have been ‘stubbornly low’.

Kaplan also said the overseas outlook is ‘sluggish’, while the world needs to adapt to a slower Chinese growth.