{"id":1321154,"date":"2022-02-21T07:52:51","date_gmt":"2022-02-21T12:52:51","guid":{"rendered":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=1321154"},"modified":"2022-02-21T07:52:56","modified_gmt":"2022-02-21T12:52:56","slug":"two-top-fed-officials-back-raising-interest-rates-in-march","status":"publish","type":"post","link":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/two-top-fed-officials-back-raising-interest-rates-in-march\/","title":{"rendered":"Two Top Fed Officials Back Raising Interest Rates in March"},"content":{"rendered":"<aside class=\"mashsb-container mashsb-main mashsb-stretched\"><div class=\"mashsb-box\"><div class=\"mashsb-count mash-medium\" style=\"&quot;\"><div class=\"counts mashsbcount\">20<\/div><span class=\"mashsb-sharetext\">SHARES<\/span><\/div><div class=\"mashsb-buttons\"><a class=\"mashicon-facebook mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/www.facebook.com\/sharer.php?u=https%3A%2F%2Fwww.conservativenewsdaily.net%2Fbreaking-news%2Ftwo-top-fed-officials-back-raising-interest-rates-in-march%2F\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Facebook<\/span><\/a><a class=\"mashicon-twitter mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/twitter.com\/intent\/tweet?text=&amp;url=https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=1321154&amp;via=ConservNewsDly\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Twitter<\/span><\/a><a class=\"mashicon-subscribe mash-medium mash-nomargin mashsb-noshadow\" href=\"#\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Subscribe<\/span><\/a><div class=\"onoffswitch2 mash-medium mashsb-noshadow\" style=\"display:none\"><\/div><\/div>\n            <\/div>\n                <div style=\"clear:both\"><\/div><\/aside>\n            <!-- Share buttons by mashshare.net - Version: 4.0.47--><div><img decoding=\"async\" src=\"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2022\/02\/21075254\/a27724f9c5296a04e03c3412e7181c4b\" class=\"ff-og-image-inserted\" alt=\"image\" \/><\/div>\n<p>(Bloomberg) &#8212; Two top Federal Reserve officials backed raising interest rates in March to curb the hottest inflation in 40 years and starting to shrink their bloated balance-sheet in coming months, signaling a consensus against more hawkish action.<\/p>\n<p>Most Read from Bloomberg<\/p>\n<p>The remarks on Friday by Governor Lael Brainard and New York Fed President John Williams, as well as Chicago Fed chief Charles Evans, showed officials eager to get tightening under way, without seeking a supersized interest-rate hike or a move before the next scheduled meeting.<\/p>\n<p>\u201cGiven we have seen quite strong data, I do anticipate it will be appropriate at our next meeting to initiate a series of rate increases,\u201d Brainard told a panel discussion at a conference in New York hosted by the University of Chicago Booth School of Business. \u201cWe have a recovery today that is much stronger and faster than in the last cycle. So I do believe it will be appropriate to commence that runoff in the next few meetings.\u201d<\/p>\n<p>Speaking separately, Williams said that while raising rates will be \u201cappropriate\u201d in March, he doesn\u2019t see a compelling argument for taking \u201ca big step at the beginning,\u201d amid speculation the Fed might increase rates by a half percentage point instead of a quarter point.<\/p>\n<p>\u201cI think we can steadily move up interest rates and reassess,\u201d Williams said during a call with reporters following an event hosted by New Jersey City University. For balance-sheet reduction, Williams said it can happen more quickly and sooner relative to liftoff than it did after the last cycle.<\/p>\n<p>He and Brainard, who\u2019s been nominated by President Joe Biden to be vice chair, are key members of Chair Jerome Powell\u2019s leadership team. The comments contrast with more hawkish remarks over the past week by St. Louis Fed President James Bullard, who spurred speculation that the Fed would start liftoff with a half-point hike and potentially consider an intermeeting move ahead of their March 15-16 gathering.<\/p>\n<p>During their Jan. 25-26 meeting, Fed officials concluded that they would soon start raising rates from near zero and were on alert for persistent inflation that would justify a faster pace of tightening, according to minutes of the session released Wednesday.<\/p>\n<p>Powell told reporters after the meeting that officials were leaning toward moving in March.<\/p>\n<p>Investors see the Fed tightening policy by around 150 basis points during this year, compared with the three quarter-point hikes that policy makers forecast for 2022 in December. They will update their quarterly Summary of Economic Projections in March.<\/p>\n<p>Brainard said raising rates and running down the balance sheet \u201cwill bring down inflation over time.\u201d<\/p>\n<p>Markets \u2018Aligned\u2019<\/p>\n<p>\u201cThe market is aligned with that,\u201d she said, adding that this has been transmitted through to the real economy via changes in mortgage and lending rates, while credit conditions for loans have also tightened. \u201cSo we\u2019ve already seen the kind of tightening facing households and businesses that is consistent with the economy\u2019s outlook,\u201d Brainard said.<\/p>\n<p>\u201cWe think the net takeaway from these two senior Fed leadership figures is that the Fed will likely not hike 50 basis points in March but will deliver an SEP that essentially matches market expectations for rate hikes,\u201d said Krishna Guha, head of central bank strategy at Evercore ISI, in a note to clients.<\/p>\n<p>Evans, one of the more dovish U.S. central bankers, earlier called for a \u201csubstantial\u201d shift in policy to curb the hottest prices in 40 years &#8212; though he said policy may not need to become restrictive unless underlying inflation became unmoored.<\/p>\n<p>\u201cWith regard to the policy situation today, I still see current inflation as largely being driven by unusual supply-side developments related to the Covid-19 shock,\u201d Evans said. \u201cBut inflation pressures clearly have widened in the broader economy to a degree that requires a substantial repositioning of monetary policy.\u201d<\/p>\n<p>Expectations Contained<\/p>\n<p>Evans said he continues to believe that underlying long-term inflation will remain low in the U.S. and developed world, held down by structural factors, and he would hold off on moving policy to a restrictive setting. Fed policy makers estimate a long-term target rate is about 2.5%. Long-term inflation expectations remain contained, he added.<\/p>\n<p>\u201cI see our current policy situation as likely requiring less ultimate financial restrictiveness compared with past episodes and posing a smaller risk to the employment mandate than many times in the past,\u201d said Evans, who does not vote on policy this year.<\/p>\n<p>While inflation caused by Covid-19 and supply disruptions should eventually correct, Evans said that will require careful monitoring of data.<\/p>\n<p>\u201cHow this plays out will be key for my monetary policy decision-making over the year,\u201d he said.<\/p>\n<p>Most Read from Bloomberg Businessweek<\/p>\n<p>\u00a92022 Bloomberg L.P.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>(Bloomberg) &#8212; Two top Federal Reserve officials backed raising interest rates in March to curb the hottest inflation in 40 years and starting to shrink their bloated balance-sheet in coming &#8230;<\/p>\n","protected":false},"author":1,"featured_media":2315279,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","fifu_image_url":"","fifu_image_alt":"","footnotes":""},"categories":[],"tags":[],"class_list":["post-1321154","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry"],"_links":{"self":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1321154","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/comments?post=1321154"}],"version-history":[{"count":0,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1321154\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media\/2315279"}],"wp:attachment":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media?parent=1321154"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/categories?post=1321154"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/tags?post=1321154"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}