Interest Rate Chatter

House view is that rates should stay untouched for next 6-18 months. We will see how that goes. - CH

Federal Reserve Governor Lael Brainard said the U.S. central bank needs to pay careful attention to underlying inflation before raising interest rates again, as longer-run price pressure trends appear to be lower. - Bloomberg

“My own view is that we should be cautious about tightening policy further until we are confident inflation is on track to achieve our target,” Brainard said in a speech at The Economic Club of New York on Tuesday. If inflation continues to fall short of the central bank’s 2 percent target, “it would be prudent to raise the federal funds rate more gradually.” - Lael Brainard

Headlines from the last time Bullard spoke, on June 29:
  • Current level of Fed rates appropriate
  • Small effect on inflation if unemployment falls
  • Weak inflation data questions rise to 2%
  • Low unemployment is probably not an indicator of meaningful higher inflation over the forecast horizon
  • Recent inflation data has surprised as the downside
  • Calls into question the idea that US inflation is reliably returning toward the target
    (link source)

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