Fed's Evans says U.S. economy doing 'quite well' but constrained

October 24, 2016 2:10 PM EDT

Chicago Federal Reserve Bank President Charles Evans takes a question during a round table with the media in Shanghai, China March 23, 2010. REUTERS/Nir Elias/File Photo

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CHICAGO (Reuters) - The U.S. Chicago Federal Reserve Bank President Charles Evans on Monday sketched a picture of a strengthening U.S. economy but one that's unlikely to break out of its current moderate growth path no matter what the Fed does or doesn't do.

The economy is doing "quite well' and the labor market has been "quite strong," Evans said, predicting economic growth of between 2 percent and 2.5 percent in the second half of this year.

But, he said, there is an "arithmetic" constraint on potential U.S. growth rates, brought by lower productivity growth and slower labor force growth, that will keep potential growth to 1.75 percent to 2 percent in the longer run.

Trying to get growth to rise higher, to say 4 percent, could result in inflation that's out of control, he said.

(Reporting by Ann Saphir; Editing by Chizu Nomiyama)

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