Fed likely to hike 25 bps next week – MNI
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Citing former senior Bank for International Settlements official and ex-New York Fed research director Stephen Cecchetti, MNI reported on Wednesday, “the Federal Reserve will likely approve a quarter-point interest rate increase next week as focus shifts from strong economic data to restoring confidence in the banking system.”
“I would try to get that message out as broadly, clearly and quickly as possible, and then I would raise interest rates. Does that mean you’re probably going to go 25 now instead of 50 and then postpone further increases? Probably yes.”
Pausing would be a “very bad signal. It would be read as you’re really worried about the financial stability consequences of further interest rate increases and you’re willing to compromise your inflation objective.”
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