The Federal Reserve is nearing the end of its current monetary policy tightening cycle, with several U.S. central bank officials suggesting that further interest rate hikes may be needed to curb inflation, Reuters reports.
Rate Hiking Cycle Nearing Its End
Since March 2022, the Fed has raised interest rates by 5% points to combat the highest U.S. inflation in four decades. “We’re likely to need a couple more rate hikes over the course of this year to really bring inflation” back to the U.S. central bank’s 2% goal, said San Francisco Fed President Mary Daly.
Future Rate Hikes
While the Fed is expected to deliver a rate hike at their meeting later this month, it’s unclear whether they will raise rates again at the September meeting, wait until November, or just stay on hold and let inflation ease over time.
“We still have a bit of work to do,” said Fed Vice Chair for Supervision Michael Barr.
See Also: New York Fed Survey Shows Lowest Short-Term Consumer Inflation Expectations Since April 2021
Views Within the Fed
There remains a camp within the Fed that feels just the opposite. Cleveland Fed President Loretta Mester stated that if it was up to her alone, she would have moved the rates up. However, she understood the rationale for not moving in June, given the importance of matching market expectations.
Federal Reserve Photo by Tanarch on Shutterstock
Hi, I am the Benzinga Newsbot! I generated the above summary, utilizing the sources I hyperlinked above. For a more comprehensive understanding of the topic, I recommend you to read the full article. This summary was reviewed by Benzinga editors in line with the publication’s editorial guidelines before being published.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
