Fed's Kashkari strikes dovish note
A top US rate-setter struck a dovish note on Tuesday, saying there was room for a tighter jobs market.
In an interview posted to the Federal Reserve bank of Minneapolis´s website, president Neil Kashkari expressed surprise at the rise seen in the labour force participation rate over the past year and a half.
Kashkari said he was "cautiously optimistic" that workers would continue to re-enter the work force.
"I think that process has more room to run," he said.
The Minneapolis Fed chief was a voting member of the Federal Open Market Committee in 2017.
Like other Fed rate-setters, he believed it might be time to begin allowing the central bank´s balance sheet to shrink in the "not too distant future", once the economy was strong enough.
One of the Fed's aims was to allow the economy to expand as quickly as possible so long as inflationary pressures were kept under wraps.
In that same regard, he believed the rate of wage growth had not yet reached "alarming" levels.
He also expressed uncertainty as to the eventual impact on productivity of the new US administration's tax cut plans, if they did not succeed in doing that he believed they could stoke inflation pressures.