U.S. labor markets could take years to recover from the setbacks of the current recession, which have pushed the unemployment rate to a 26-year high, top Federal Reserve policy-makers said on Wednesday.
But the officials said the Fed may need to end its ultra-accommodative policy stance long before the jobless rate starts to plummet if inflation starts to rise.
For now, though, that seems some way off given the tentative nature of the economic recovery.
"Given the lag between the time monetary policy is initiated and when it impacts the economy, that wind-down process needs to begin as soon as there are convincing signs that economic growth is gaining traction," Dallas Federal Reserve Bank president Richard Fisher told a meeting of the North Dallas Chamber of Commerce. (more)
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