Fed's Kaplan: Concerned about excesses in risk assets and debt buildup

The Federal Reserve's new strategy is not a radical change but an affirmation of the way they've been operating, Dallas Federal Reserve Bank President Robert Kaplan told Bloomberg TV on Friday.

"It's possible it will take a while for inflation to get to 2%," Kaplan added. "For me, inflation a little bit above 2% means maybe 2.25% but the Fed seeks flexibility."

Regarding concerns over an asset bubble, "the Fed needs to be conscious of financial stability and excesses that could exist as a result of their policies," Kaplan noted. "Concerned about excesses in risk assets and debt buildup after the Fed's actions to stabilize financial markets."

Market reaction

The greenback continues to have a difficult time finding demand on Friday. As of writing, the US Dollar Index was down 0.85% on a daily basis at 92.22.