Wall Street Journal (12/31/14) Ben Leubsdorf

The U.S. Federal Reserve will have to be more aggressive about rate increases the longer it waits to lift them from near-zero, according to a new paper co-authored by Federal Reserve Bank of Philadelphia president Charles Plosser. He has opposed the Fed’s efforts to stimulate economic growth in recent years and believes the bank should adopt a formal rule to guide policy.

“Delaying liftoff well into 2015 runs the risk of requiring more aggressive future monetary policy than would otherwise be needed,” the paper’s authors concluded, though they added such risks should “be balanced with the prospect that inflation could run persistently below target.”