Rate hike might be delayed until 2016, warns leading Fed official

Chris Papadopoullos
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THE US Federal Reserve should not hike interest rates until 2016, one of its officials said yesterday.

“I think economic conditions are likely to evolve in such a way that it will be appropriate to hold off on raising short-term rates until 2016,” Charles Evans – a member of the committee that decides policy – told a London audience.

One of his main concerns was the “number of people who are involuntarily em­ployed part-time remains unusually high.”

“If the economy were closer to full employment, these individuals would have more opportunities to find full-time jobs.”

He added: “Economic activity appears to be on a solid, sustainable growth path.

“However, inflation is low and is expected to remain low for some time — and I have serious concerns that inflation will run even lower than I expect.”

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