(Reuters) -Philadelphia Federal Reserve Bank President Patrick Harker said on Monday that he does not expect interest rates to rise until after the central bank is done tapering its asset purchases, but that the Fed is prepared to act on high inflation if needed.

“I don’t expect that the federal funds rate will rise before the tapering is complete,” Harker said during a virtual event organized by the Economic Club of New York. “But we are monitoring inflation very closely and are prepared to take action, should circumstances warrant it.”

The policymaker also said he expects inflation to moderate over the next year as supply-demand imbalances caused by the pandemic are resolved. He echoed a message shared by Fed officials last week when they announced they will begin to reduce the pace of the central bank’s purchases of Treasury securities and mortgage-backed securities by $15 billion a month. [nL1N2RT12T]

U.S. consumers’ short-term inflation expectations rose again in October but the medium-term inflation outlook remained stable, according to a separate report released on Monday by the New York Fed.

Harker said he expects the U.S. economy to grow by about 5.5% this year and by 4% next year if there isn’t another wave of COVID-19 infections. Growth could then come down to the range of 2% to 3% in 2023, he projects.

The Fed official also said he expects more people to return to the labor market over time as forbearance programs run out, nodding to a labor shortage that has been puzzling economists and policymakers.

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