US Rates Need to Rise Soon Absent Evidence of Ongoing Drop in Inflation, Fed’s Collins Says
Susan Collins said the central bank may need to tighten policy soon if inflation does not keep easing, with Reuters polling economists expecting 3.3% core PCE in July.
- On Tuesday, Boston Fed President Susan Collins warned the Federal Reserve must raise interest rates soon unless inflation continues to decline, describing price pressures as a "pervasive" concern for businesses and households.
- With inflation exceeding the central bank's 2% target for more than five years, Collins argued the Fed cannot wait forever; the policy rate has remained in the 3.5% to 3.75% range since December.
- Three-Month annualized figures suggest the disinflation process may have stalled around 3 percent, leaving policymakers to assess whether recent moderation represents a genuine trend or merely a temporary pause.
- Financial markets reacted as Treasury yields edged higher and traders reduced expectations for near-term rate cuts; Fed Chairman Kevin Warsh delivers a keynote address at the central bank's annual research symposium on Thursday.
- New York Fed President John Williams and Richmond Fed President Thomas Barkin have similarly stressed the need for patience, while Collins, a voting member of the Federal Open Market Committee, emphasized policymakers must remain data-dependent.
12 Articles
12 Articles
Fed's Collins Says Holding Rates Hangs on Inflation Progress
Fed's Susan Collins: Rates May Rise If Disinflation Stalls
Federal Reserve Bank of Boston President Susan Collins signaled that interest rates may need to climb higher in the near term if fresh data fails to confirm that inflation continues to ease toward the central bank's 2 percent target. Her remarks, delivered during a panel discussion, reflect ongoing internal debates at the Fed about the appropriate path for monetary policy amid mixed economic signals. Collins, who votes on the Federal Open Market…
US rates need to rise soon absent evidence of ongoing drop in inflation, Fed’s Collins says
By Howard Schneider WASHINGTON, Aug 25 (Reuters) – The U.S. Federal Reserve will need to raise interest rates soon unless coming data show a continued decline in inflation that remains too high and which has become a “pervasive” concern for businesses and households, Boston Fed President Susan Collins said on Tuesday. Collins said in comments posted to the Boston Fed website that the current Fed policy rate, under her base case outlook, will c…
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