The Federal Reserve is the only institution in Washington acting to support economic growth, but its low-rate policy could be backfiring, former Dallas Fed President Richard Fisher said Thursday.
Fisher offered his assessment one day after the Federal Open Market Committee left rates unchanged and more members of the policymaking group indicated they anticipate just one hike this year rather than two.
Congress’s failure to stimulate the economy through fiscal policy has forced the Fed to keep monetary policy accommodative, he told CNBC’s “Squawk Box.” But low rates are taking a toll on community and regional banks that lend to middle-income groups, he said.
That pressure, combined with over-regulation, is retarding growth, he said.
“There’s very little incentive, together with the pincer movement of regulatory excess, for people to go out there and lend into job-creating enterprises,” he said.
