Fed policymakers lean against October rate hike
NEW YORK: Two of the Federal Reserve’s top policymakers this week staked out an unusually clear case for taking in more data before deciding about another interest-rate hike, driving investors to largely abandon bets on an interest rate increase at the central bank’s next policy meeting, in late October.
Federal Reserve policymakers have indicated they are taking a cautious approach to interest rate hikes, citing a need for more data before making a decision. John Williams, President of the Federal Reserve Bank of New York, stated that an additional rate increase may be appropriate later in the year, but it is not urgent to make changes to the current policy setting.
Federal Reserve Vice Chair Philip Jefferson echoed this sentiment, emphasizing that adjustments should be made based on careful examination of trends, evolving outlook, and balance of risks. The recent bond market yield increases, signaling market reassessment of the outlook, have influenced this cautious stance. Traders now anticipate only a 25% chance of a rate hike during the upcoming October meeting, down from earlier expectations of around 70%.
The latest economic data showed a 3.4% year-over-year increase in the personal consumption expenditures price index in August, which is above the Fed's 2.0% target but not worse than July. Analysts believe the Fed will only raise rates once more this year, in December, rather than in October.
Written by urgent.news from New Straits Times's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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