Fischer Sees Price Pressure As Unemployment Declines
Federal Reserve Vice Chairman Stanley Fischer, who leaves office later this month, continues to expect a tightening U.S. labor market to lift wages and prices even though the process can take longer than anticipated.
“I still believe we will have higher inflation,” Fischer said Wednesday in an interview on Bloomberg Television. “The basic mechanism here is unemployment is declining all the time, wages will start going up at some stage.”
“The experience many of us have, including myself, is you have to wait a long time — usually longer than you expected to wait — for something to happen,” said Fischer. “But then, if it’s a very basic force, namely increasing employment, increasing wages, it’ll show up.”