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The Fed’s Mester said the economy is far from central bank goals but the outlook is brighter

© Reuters. FILE PHOTO: President of the Federal Reserve Bank of Cleveland Loretta Mester speaking in London

By Jonnelle Marte

(Reuters) – The US economy still has a long way to go to fully recover from the crisis caused by the coronavirus pandemic, which has hit the minorities and those with low education hardest. But the outlook is improving, Federal Reserve Bank President Loretta Mester said on Thursday.

Mester said during a virtual event with students from Swarthmore College, “While the economy is still far from our policy goal of maximum employment and price stability, progress is being made and The economic outlook is bright “.

On the inflation front, Fed officials said the price indexes could be high in the near term as firms grapple with supply chain disruptions and prices rebound from lows reached early in the pandemic, but rise. Growth is likely to slow as time passes and those challenges are addressed.

“I’m not too worried about inflation rising too high right now,” Mester said.

Mester told reporters after the event, the US economy could see strong growth in the second half of the year, and labor market conditions will continue to improve as long as there is no spike in schools. infection with vaccine-resistant strains.

Policymakers expect the US economy to grow 6% or more this year and the unemployment rate drops to 4.5% or less by the end of the year.

Vaccination, she said, will help people get back to work safer, will be an important part of the recovery process. Parents who have left work because their children are at home will need schools to reopen and access childcare so they can return to the workforce, Mester added.

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