![]() Goolsbee, who spoke on a panel with Bostic, said that banks in his region have tightened credit because of the Fed’s rate hikes and not necessarily because of the bank failures.īut they haven’t gone further because of the bank failures. “We have a small number of institutions that had risk management strategies that work less well than you would like.” “I don’t know that we have a crisis right now in financial markets,” Bostic said. Raphael Bostic, president of the Federal Reserve Bank of Atlanta, and Austan Goolsbee, head of the Chicago Fed, said this week that they haven’t seen lenders in their districts pull back on lending just because of the bank failures. Several Fed officials have suggested that the failure of Silicon Valley Bank and two others might have little impact. ![]() his press conference Jerome Powell offhandedly referred to the. Not all Fed officials share Powell’s concern that the upheaval in banking will harm the economy. Markets have high confidence that the Federal Reserve will raise rates 0.25-percentage-points at their next decision on July 26. “The data have continued to support the (Fed’s) view that bringing inflation down will take some time,” Powell said. Inflation was 4.2% in March, compared with a year earlier, though it is down from 7% last June.īut excluding volatile food and energy costs, so-called core inflation has slowed much less, from a peak of 5.4% in February 2022 to 4.6% in March. Inflation, under the Fed’s preferred measure, has declined but remains far above the central bank’s 2% annual target. Lorie Logan, president of the Federal Reserve Bank of Dallas, said Thursday that inflation remained too high and that the latest economic data didn’t yet justify a pause in hikes. But several others expressed their belief that the Fed would have to further raise rates to curb persistent inflation. Most of the policymakers signaled support for a pause at its next meeting. “Of course, the extent of that is highly uncertain.”Ĭomments from Fed officials this week had conveyed decidedly mixed messages about the central bank’s likely next move. ![]() “As a result, our policy rate may not need to rise as much as it would have otherwise to achieve our goals,” he said.
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