US inflation target within ‘hailing distance’, says Fischer

The vice-chair of the Federal Reserve's Board of Governors has said the central bank is close to meeting both its targets for the US economy.

Speaking in Aspen on August 21, Stanley Fischer refrained from offering his views on the interest rate outlook but did note core inflation is within "hailing distance" of the Fed's 2% target; employment, he said, has also increased "impressively" since it hit a trough in 2010.

"We are close to our targets," Fischer said. "I expect GDP growth to pick up in the coming quarters, as investment recovers from a surprisingly weak patch and the drag from past dollar appreciation diminishes."

In late July, the US Department of Commerce announced GDP was 1.2% in the second quarter of 2016, in comparison with 0.8% in the first quarter. The median of the Fed's latest projections implies 2% growth in 2016 and 2017.

Fischer's remarks come as Fed chair Janet Yellen is due to speak at the annual Jackson Hole symposium on August 26.