Evans sees need for more Fed stimulus to fuel stronger growth

Federal Reserve Bank of Chicago President Charles Evans (Source: Bloomberg) Federal Reserve Bank of Chicago President Charles Evans (Source: Bloomberg)

Federal Reserve Bank of Chicago President Charles Evans, a consistent backer of record stimulus who votes on policy this year, said more accommodation is warranted to spur an inadequate U.S. expansion.

“If you look at our scorecard in the U.S., the unemployment rate continues to be a couple of percentage points above the sustainable rate and inflation is under-running, so that calls for more accommodation, I think for anybody looking at it coolly and objectively,” Evans said today during a panel discussion in Washington.

“U.S. growth is not nearly strong enough,” he said at an International Monetary Fund event.

Gross domestic product rose at a 2.5% annualized rate in the second quarter after a 1.1% gain in the first three months.

The Federal Open Market Committee surprised investors last month by refraining from tapering $85 billion in monthly bond purchases, choosing to wait for more evidence the economy is strong enough to bring down 7.3 percent unemployment.

By waiting, the Fed sustained stimulus as Congress debates how to resolve the first government shutdown in 17 years and whether to raise the national debt limit.

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