Fed’s Jefferson Says Productivity Growth Can Help Curb Inflation

Federal Reserve Vice Chair Philip Jefferson said he was “cautiously optimistic” about the outlook for the US economy, suggesting strong productivity growth could help return inflation to the central bank’s 2% target.

“I expect the disinflationary process to resume this year once increased tariffs pass through more fully to prices. In addition, projected strong productivity growth may be a source of further help in bringing inflation down to our 2% target,” Jefferson said Friday in remarks prepared for a speech in Washington.

With the Fed “strongly committed to returning inflation to its target, the risk of such a one-time shift ...