Federal Reserve Gov. Christopher Waller said today he supports a “significant increase” in the federal funds rate at the next Federal Open Market Committee meeting on Sept. 20-21.
Browsing: Interest rates
The Federal Reserve must act “strongly” to fight inflation “until the job is done,” Fed Chair Jerome Powell said today in his final public appearance before the Federal Open Market Committee meets Sept. 20-21.
It will be necessary to raise the federal funds rate to “somewhat above 4%” by early next year and hold it there, predicted Loretta Mester, president of the Federal Reserve Bank of Cleveland, during a speech today.
A recent easing in the rate of inflation hasn’t been enough to convince the Federal Reserve to reverse course on raising interest rates, with the Federal Open Market Committee likely to pursue a “restrictive policy stance for some time,” Fed Chair Jerome Powell said during remarks today.
A tight labor market and high inflation convinced the Federal Open Market Committee to unanimously approve a 75 basis point rate-hike in July, according to minutes released today.
Markets expect at least a 75 bps hike at the next FOMC meeting, which takes place July 26-27. More than half of respondents expect the Fed will need to increase rates an additional 100 bps over the next year to tame inflation.
The spread between the two-year and 10-year notes dipped negative last Monday for the first time since April. Historically, protracted inversions of the yield curve have preceded U.S. recessions.
In a move to slow the specter of inflation, the Federal Reserve today increased the target range for the federal funds rate by three-quarters of a percentage point to 1.5% to 1.75%—the central bank’s most aggressive hike since 1994.
The cost of existing credit card debt continues to rise as the Federal Reserve has increased interest rates this year—so far, by $4.9 billion, according to a recent WalletHub survey.
Despite the Fed tightening monetary policy—increasing the fed funds rate 75 basis points—real rates* remained deeply negative at the end of April, ticking up only 30 bps over the month.