Nov 1 (Reuters) - The Federal Reserve needs to be wary of allowing U.S. fiscal policy to drive monetary policy decisions, Philadelphia Fed President Charles Plosser said on Friday, adding the short-term effects of the 16-day government shutdown should be small.
"We could easily find ourselves in what some people describe as a fiscal dominance regime where monetary policy becomes totally driven by fiscal policy. That's not a good place," Plosser said on CNBC.
"I don't believe the shutdown is terribly consequential from an economic point of view in terms of the economy in the short run. It will have some economic effects but they will be small and it will be temporary."