Fed's Paulson says Fed would react to burst of inflation

(Reuters) -Federal Reserve Bank of Philadelphia President Anna Paulson said on Monday that if inflation pressures do not moderate as she expects the central bank should be willing to take action.

If inflation shows “a burst of, you know, shows some life, then the Fed's going to have to react appropriately, whether that's, you know, keeping the policy rate at, you know, current levels or whether that's increasing” the rate, Paulson said at an event held by the National Association for Business Economics in Philadelphia.

(Reporting by Michael S. Derby; Editing by Chris Reese)

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