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 Fed policymakers on Thursday voted to keep the Fed's target interest
rate at between zero and a quarter point.
"Such exceptionally low real interest rates are unlikely to be
appropriate for an economy with persistently strong consumption
growth and tightening labor markets," Lacker said in a statement.
He was the lone dissenter among the 10 Fed officials who voted at
the meeting. Lacker said the Fed's target should rise by a quarter
point.
Lacker has a history of dissent in Fed policy meetings. In 2012, he
voted against eight straight policy decisions by the central bank.
At the time he was urging the Fed to wind down asset purchases that
were aimed at stimulating the economy.
Regarding Thursday's decision at the Fed, Lacker said a rebound in
consumer spending and "tightening labor markets" meant the economy
no longer needed zero interest rates.
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He said keeping interest rates at their current level deviated from
the way the Fed has responded to the economy in the past, which was
dangerous because public understanding of the Fed's behavior was "an
essential foundation for the monetary stability we currently enjoy."
"Such departures are risky and raise the likelihood of adverse
outcomes," Lacker said.
(Reporting by Jason Lange, editing by David Evans)
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