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Fed's Rosengren: Additional monetary stimulus not needed

Credit: REUTERS/Keith Bedford

Boston Federal Reserve Bank President Eric Rosengren, who dissented from the central bank's decision to cut interest rates earlier this week, repeated on Friday that monetary stimulus was not needed for the U.S. economy and posed its own problems.

WASHINGTON, Sept 20 (Reuters) - Boston Federal Reserve Bank President Eric Rosengren, who dissented from the central bank's decision to cut interest rates earlier this week, repeated on Friday that monetary stimulus was not needed for the U.S. economy and posed its own problems.

"Additional monetary stimulus is not needed for an economy where labor markets are already tight, and risks further inflating the prices of risky assets and encouraging households and firms to take on too much leverage," Rosengren said in a statement explaining his decision.

"While risks clearly exist related to trade and geopolitical concerns, lowering rates to address uncertainty is not costless," he added.

On Wednesday the Fed voted 7-3 to cut borrowing costs by a quarter of a percentage point to a range of 1.75% to 2.00% after a similar cut in July in what Fed Chair Powell has termed a "mid-cycle adjustment" to maintain a record U.S. economic expansion.

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(Reporting by Lindsay Dunsmuir Editing by Nick Zieminski)

((Lindsay.Dunsmuir@thomsonreuters.com; +1 202 898 8411;))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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