SANTA FE, N.M. -- Jerry Jordan, president of the Cleveland Federal Reserve Bank, told a group of banking executives here that the Fed needs to convince businesses and consumers that it is "steadfast about pursuing price stability."

"What could the Federal Reserve, regardless of the outcome of the [presidential] election, do to convince you that inflation and interest rates will remain low for the rest of the '90s?," Mr. Jordan said.

"Nobody believes inflation is going away."

He said long-term rates were being kept high by inflationary expectations.

"Long-term interest rates will fall when people become convinced the Federal Reserve is pushing toward zero inflation, and will persevere with what we're doing," Mr. Jordan said.

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