(Reuters) - The grim U.S. jobs report for May does not warrant further easing of monetary policy, Sandra Pianalto, President of the Federal Reserve Bank of Cleveland, was quoted as saying on Monday.
Pianalto told the Wall Street Journal that even though the jobs report was disappointing, she was not yet convinced the economy was taking a turn for the worse.
“I’d have to see a substantial change in my outlook,” to be convinced the Fed should do more, Pianalto told the WSJ.
“I don’t think this employment report, in and of itself, is likely to lead to a substantial change in my outlook. Consequently, it would not lead me, at this time, given what I know about my outlook, to change my position on policy.”
Pianalto made her comments as the Fed prepares for a June 19-20 policy meeting. She is a voting member of the Fed’s policy-setting Federal Open Market Committee this year.
U.S. job growth braked sharply in May and the unemployment rate rose for the first time since last June, putting pressure on the Federal Reserve to ease monetary policy further to shore up the sputtering recovery.
The Labor Department report on Friday showed employers added 69,000 jobs to their payrolls last month, the fewest since May last year.
For now, at least, Pianalto wants to keep Fed policy where it is, planning to keep short-term interest rates near zero through late 2014, and be prepared to do more if her economic forecast substantially deteriorates, the paper said.
Reporting by Sakthi Prasad in Bangalore; Editing by Ron Popeski