Fed's Barkin: Fed has the ability to respond to economic changes

Odaily News Fed's Barkin said the economy is in good shape, which allows the Fed to lower borrowing costs. "A strong but more discerning consumer, combined with a more productive, higher-value workforce, makes for a great economy," Barkin said Tuesday in remarks prepared for a speech at the Common Summit in Baltimore. "The Fed has the ability to respond appropriately, no matter how the economy develops," he said, noting that interest rates have come off their peak but remain above historic lows. Barkin said he was considering two scenarios for the economy: As election uncertainty fades, companies could begin to reinvest and hire, allowing the Fed to focus on upside risks to inflation. Alternatively, companies could respond to margin compression from weakened pricing power by laying off employees, which would increase the employment risks facing the Fed. (Jinshi)