Fed Explores More Aggressive Interest Rate Hikes To Counter Inflation While Weighing Associated Risks

Federal Reserve officials discussed moving the U.S. central bank to a "restrictive" policy stance to counter inflation through more fierce interest rate increases, the Financial Times reports.
However, the policy could undermine the strong recovery in the jobs market.
Some Fed officials also saw risks to commodities markets stemming from the disruptions associated with the Ukraine war.
Multiple officials saw risks to financial stability related to the tightening cycle that could hurt the liquidity of Treasury securities markets and the private sector's intermediation capacity.
Most U.S. monetary policymakers agreed to increase the Fed's primary interest rate between 0.75% - 1%, by 50 basis points at the next set of meetings.
The officials backed the central bank's plans to reduce its balance sheet and consider selling mortgage-backed securities as an additional tool.
Tackling the high inflation was currently the central bank's most significant challenge while retaining price stability to prevent the low-income households from getting bankrupt.
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