U.S. financial system ‘very robust’ despite market worries: Fed’s Quarles

NEW YORK (Reuters) – The U.S. economic system and labor market are strong with inflation contained, even whereas financial markets have just lately been targeted on the danger that world financial development will sluggish additional, a Federal Reserve governor mentioned on Thursday.

“Markets are extra attuned at the moment to draw back dangers however the core, the bottom case stays very sturdy” for the U.S. economic system, Randal Quarles, the central financial institution’s vice chair for supervision, mentioned at an insurance coverage business convention.

“Inflation stays very effectively contained … and that’s an excellent setting,” he stated. “The information on the actual economic system…continues to look robust.”

The Fed raised rates of interest four occasions final yr together with in December. However, since then, it has nodded to a few of the considerations buyers have increased since October, with Fed Chairman Jerome Powell taking extra of a wait-and-see strategy to additional financial tightening.

Quarles mentioned financial markets are principally reacting to “some doubt in regards to the power of continued world progress,” together within China and Europe, the place knowledge “suggests a bit much less progress within the close to the period in these jurisdictions.”

“However even there you possibly can see a story the place that latest information is a result of transitory elements, and we can get to the opposite aspect of that,” he added on the Insurance coverage Info Institute.