Fed’s new rate-hike tools ‘proved effective’, Fischer says

SAN FRANCISCO—The Federal Reserve’s new tool kit was successful in raising the U.S. central bank’s benchmark federal-funds rate after the December decision to lift off from zero, but officials are prepared to make changes if problems arise, Federal Reserve Vice Chairman Stanley Fischer said Sunday.

“One possible concern about our unconventional policies has eased recently, as the Fed’s normalization tools proved effective in raising the federal-funds rate following our meeting two and a half weeks ago,” Mr. Fischer said at the American Economic Association’s annual conference. “Of course, these are early days yet with regard to normalization of interest rates, and issues may yet arise that would require adjustments to our tools, and we stand ready to do that.”