Fed’s Waller sais, no need for higher interest rates
2022.11.16 15:00
Fed’s Waller sais, no need for higher interest rates
Budrigannews.com – Fed’s Governor Mark Waller said Tuesday that he was an early and outspoken “hawk” on the central bank’s efforts to combat inflation. He said future interest rate rises would be “more comfortable” after recent data showed the pace of price increases was slowing.
In remarks prepared for an announcement at the Arizona Economic Conference, Waller said it was unclear whether the Fed needed to raise interest rates and that he would not make a final decision on what to do with the Fed. 13-14 Until the Policy Meeting considers the rest of the data between now and then.
Waller said consumer price data released last week showed larger-than-expected falls in both headline inflation and the index, which was more closely watched by a narrow but “core” price. “We’ve seen this movie before.”
But he also said the latest report was a “positive development” that he hoped would be “the beginning of a significant and lasting decline in inflation” back to the Fed’s 2 percent target.”The data of the last few weeks has made me feel more comfortable considering that we are entering a 50 basis point hike in January,” Waller said after raising interest rates with unusually large three-quarter point increases in the last four meetings.
The Fed’s latest policy statement signaled that the scale of the upcoming rate hike is likely to taper off, and officials shifted their focus to a more nuanced approach that would give more time to monitor how the economy and inflation are behaving.
The recent positive news on inflation is that investors need to raise the target monetary policy rate to around 5%, not as expected by the Fed, which is currently set in the range of 3.75% to 4%.
Signs of slowing economic and wage growth add to the sense that Fed policy is starting to do its job, Waller said.
But he cautioned that it is too early to pin down how high the rate might be.
“A report does not set a trend. It is too early to conclude that inflation is heading downwards in a sustainable way,” he said. “In order for inflation to fall significantly and persistently towards the 2% target, we need an increase in the federal financing rate until next year,” he said. There is still a way to go.”
