2023-09-22 15:05:00
Federal Reserve Board Director David Bowman has indicated that he may think it is desirable to raise interest rates multiple times. It has been suggested that the Bank is taking a more proactive stance than other authorities in tightening monetary policy to curb inflation.
Director Bowman spoke at a meeting hosted by Colorado’s independent community bank organization on the 22nd. “I still believe that multiple further rate hikes will be necessary to bring inflation down to 2% in a timely manner,” he said, referring to the outlook for interest rates, adding that he did not use the word “rate hikes” in reference to the outlook for interest rates. Expressed in plural form.
Bowman said that the latest interest rate forecast distribution map (dot plot) released by the Federal Open Market Committee (FOMC) the other day shows that the inflation rate will not fall to 2% until the end of 2025 at the earliest. He pointed out.
“This, combined with my own expectations, suggests that current monetary policy restraint will slow the pace of inflation. Further policy tightening is therefore necessary to bring inflation down sustainably and in a timely manner. It is suggested that this will happen.”
FOMC leaves policy interest rate unchanged, hinting at one more rate hike this year (4)
The target range for the federal funds (FF) interest rate is 5.25-5.5%. The FOMC’s latest quarterly economic forecast, released at the same time as its statement, showed 12 out of 19 participants supporting one more rate hike this year. The median forecast calls for the federal funds rate to fall to 5.1% by the end of 2024, which is higher than the previous forecast.
In the dotplot, one official had the expected range for the federal funds rate in 2024 at 6-6.25%. Mr. Bowman’s comments that day indicated that he may have been the official who gave the highest interest rate forecast.
Interest rate forecast distribution map (dot plot)
Source: Federation Preparatory Board (FRB)
Original title:Fed’s Bowman Signals She Favors More Than One Further Rate Hike(excerpt)
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