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Uncertain U.S. fiscal policy should not handcuff Fed: Williams

Reuters

(Reuters) - The Federal Reserve can prepare to raise interest rates this year without knowing details of any new U.S. fiscal policies because inflation is firming and the labor market looks good, a regional Fed policymaker said on Friday.

"I wouldn't want to be too timid or delay too long this path of rate increases," San Francisco Fed President John Williams, a centrist who is close with Fed Chair Janet Yellen, said on Bloomberg TV, calling the policy-tightening path "gradual."

There is "a lot of uncertainty" around fiscal policy over the next two years, he added. Yet "given where we are today" with some positive inflation pressures and good jobs growth, including in January, the Fed "can make decisions based on that without actually knowing" coming fiscal policies.

(Reporting by Jonathan Spicer; Editing by Chizu Nomiyama)

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