US monetary policy appropriately quite accomodative, Fed's Dudley says

The stance of monetary policy in the US was the correct one despite the unusual lengtt of the current upturn because inflation remained below target and there was still slack in the labour market, a top Federal Reserve official said on Friday.

Monetary policy was "appropriately quite accommodative," he said.

Those remarks were made by the President of the NY Fed, Charles Dudley, after the regional Fed bank published data showing US household debt stood at $12.12trn at the end of the fourth quarter, with delinquencies running at 5.4%, their lowest since mid-2007, Reuters reported.

In Dudley's opinion, the fact that the current economic expansion was now nearly seven years-old - and thus the third longest since the Second World War - did not mean the risk of recession was edging higher.

"Since the possibility is low that a significant inflation risk would emerge over the near term, this means that the main danger facing the current expansion is the risk of large, adverse shocks," Dudley said.