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Federal Reserve Bank of Dallas President Robert Kaplan said the U.S. central bank should put interest rates on hold as it waits to see how uncertainties about global growth, weakness in interest-sensitive industries and tighter financial conditions play out.

“We should not take any further action on interest rates until these issues are resolved, for better, for worse,” Kaplan told Bloomberg’s Michael McKee in a television interview today (Jan. 3). “So I would be an advocate of taking no action and — for example — in the first couple of quarters this year, if you asked me my base case, my base case would be take no action at all.”

Kaplan, who next votes on policy in 2020, also indicated a willingness to be open-minded about adjusting the Fed’s balance-sheet runoff if needed — something some market commentators have been calling for but the central bank has resisted to date.

The Dallas Fed chief often says that he watches markets carefully. Stocks experienced the worst December rout since the Great Depression as the threat of higher interest rates, a trade war with China and slowing growth abroad stirred doubt in investors’ minds. Financial conditions have tightened amid recent volatility, and both U.S. confidence and worldwide manufacturing gauges are weakening.

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