The Federal Open Market Committee (FOMC) 2024 voting member Raphael Bostic said on Monday (9th) that the Federal Reserve (Fed) can continue to raise interest rates by two yards in the next two to three meetings. 50 basis points), and then assess the economy and inflation before deciding whether further rate hikes are needed.
Bostic said in an interview that the Fed’s two-yard rate hike last week “was already quite a radical move” and that more aggressive policy was no longer needed. The remarks appeared to rule out a three-yard (75 basis points) larger rate hike.
Postik said that the current pace and rhythm can be maintained and the market changes, and then there may be two or three meetings to raise interest rates by two yards, and then pause to assess the economic changes and whether inflation is close to the Fed’s 2% target. Make another decision.
The path for interest rate policy outlined by Postik is consistent with comments made by Fed Chairman Powell at a news conference last week, when Powell said officials supported the Fed’s decision to raise rates by 2 yards in the next few meetings but were not actively considering it. Higher interest rates.
Investors and many economists believe the Fed will be forced to take a series of more aggressive rate hikes to stem inflation at multi-decade highs. Postik said he hoped some supply chains and other factors driving prices would work in the Fed’s favor, that high inflation is only short-lived.
Bostic also hopes that problems beyond the Fed’s capacity, such as supply chain disruptions, can be improved, saying that if the Fed sees changes on the supply side, it means raising interest rates to reduce the boost to demand.
