Fed's Stern says next rate move is up
WASHINGTON, Aug 20 (Reuters) - Minneapolis Federal Reserve Bank President Gary Stern said on Wednesday the U.S. central bank has done all it needs to protect the economy from downside risks and now must be ready to move rates up.
"We've reduced the federal funds rate a lot relative to last fall, we've provided a lot of liquidity....so I think we've largely addressed the potential downside risks from here," he said in an interview on Bloomberg television.
He said that inflation should begin to ease in coming months but suggested that if he was wrong, the Fed must be prepared to start raising rates to curb price rises.
"I'm cautiously optimistic that will occur, if it doesn't we may have to move," Stern said.
(Reporting by Glenn Somerville and Richard Leong, Editing by Chizu Nomiyama)
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