Fed's Mester: Fed “got the persistence and magnitude” of inflation “wrong

Federal Reserve Bank of Cleveland President Loretta Mester said that the Fed's median path does not envision recession but does have "quite a bit" of slow down in growth

Key notes

Trade-offs with growth will become more relevant as inflation comes back down.
    
Given the persistence of inflation, still puts more weight on being sure the fed does enough.
    
Fed "got the persistence and magnitude" of inflation "wrong".

Earlier, she said Thursday in an interview on CNBC that “real interest rates -- judged by the expectations over the next year of inflation -- have to be in positive territory and held there for a time.”

“We’re still not even in the restricted territory on the funds rate,” she added.

The US dollar ran to a 20-year high in September following the move by Fed officials that raised interest rates by 75 basis points on Sept. 21 for the third straight meeting, bringing the target for the benchmark federal funds rate to a range of 3% to 3.25%.