Dallas Fed President Robert Kaplan emphasized “we should be as aggressive as we can be while we are in the teeth of this pandemic, until we are convinced that we have weathered this pandemic.”
Though, “later this year, my own view is, we should at least be having an earnest discussion about when it’s appropriate to taper” the asset purchase program.
He expects the US economy to grow around 5% this year, with unemployment rate falling back to 4.50-4.75% from current level of 6.7%. The economy will then have made “substantial progress” towards Fed’s dual mandate.
By the time, “I think it’s a healthier for the U.S. economy and for markets to wean off these extraordinary actions and this extraordinary stimulus,” he said.
