Fed’s Daly says inflation will be guide on U.S. full employment

The U.S. central bank’s job is to eliminate employment shortfalls, and it will look to inflation to gauge whether it is meeting that goal, San Francisco Federal Reserve President Mary Daly said on Wednesday.

“We are not going to write down some artificial number about maximum employment, and when we get close to that, we worry,” Daly said in a virtual event hosted by the St. Louis Fed.

“We are going to let inflation be the guide of that… We are committed to allowing the economy to run until we find out what maximum employment means experientially – when we start seeing it show up in higher wages and higher prices.”