Fed’s Mester Says Improved Economic Outlook Supports More Rate Rises

Says inflation should move to 2% inflation over the next year or two

Federal Reserve Bank of Cleveland President Loretta Mester said Monday that a shifting outlook for the economy may mean the central bank has to raise rates more than she once expected.

“With fiscal policy turning from restrictive to stimulative, the economy growing above trend, and investment rising, the short-term equilibrium interest rate is rising, too,” Ms. Mester said in the text of a speech to be presented at an event in Paris.

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