A key Federal Reserve official said Wednesday that the economic conditions for raising interest rates could be met by the end of 2022, paving the way for a liftoff of the Fed’s benchmark rate from its current level of near zero. Federal Reserve Vice Chair Richard Clarida, the Fed’s second-in-command, said in a webcast discussion hosted by the Peterson Institute for International Economics that the central bank estimates that the U.S. economy will grow faster than the projected long-run trend growth through 2023, with robust growth in gross domestic product (GDP) driving down the unemployment rate to 3.8 percent by the end of 2022. “My expectation today is that the labor market by the end of 2022 will have reached my assessment of maximum employment,” Clarida said, adding that if inflation expectations remain “well anchored” at the Fed’s 2 percent longer-run goal, “commencing policy normalization in 2023 would, under these conditions, be …
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