×
Newsmax TV & Webwww.newsmax.comFREE - In Google Play
VIEW
×
Newsmax TV & Webwww.newsmax.comFREE - On the App Store
VIEW
Tags: federal reserve may 50 basis point interest rate increase chances | mary daly

Fed's Daly: Case for May 50 BPS Hike Is 'Complete'

Fed
U.S. Federal Reserve Bank, Washington, D.C. (Getty Images)

Wednesday, 20 April 2022 02:34 PM EDT

San Francisco Federal Reserve President Mary Daly on Wednesday said she believes the case for a half-percentage-point interest rate hike next month is "complete" and "solid," with the U.S. central bank's rate hike path this year broadly seen as appropriate in the face of high inflation.

With the Fed set to raise its benchmark overnight interest rate to 2.5% over the course of this year and announce the start of the reductions in its balance sheet at its May 3-4 policy meeting, she said, "my modal outlook is that we'll have a soft landing," with the U.S. economy slowing to below its trend growth rate but not tipping into recession, she told reporters after a speech at the University of Nevada, Las Vegas.

If there is a recession, she said, it will be short and mild, a matter of a couple of quarters with growth "just a tiny bit below zero" and not enough to derail a longer-term expansion.

At the same time, she said, businesses and households find it "comforting" that the Fed is raising rates. Doing so, she said, will not just help bring down inflation that is too high, but will also serve to slow what she said is getting to be a "frothy" labor market. Consumer prices rose 8.5% on an annual basis in March, the fastest increase since late 1981, and unemployment fell to 3.6%, with job vacancies at near records.

It's "premature," Daly said, to judge how far rates will ultimately need to rise. As the Fed raises rates, she said she'll be assessing the economic impact of tighter U.S. monetary policy, Russia's war in Ukraine and the state of supply chains.

© 2024 Thomson/Reuters. All rights reserved.


StreetTalk
San Francisco Federal Reserve President Mary Daly on Wednesday said she believes the case for a half-percentage-point interest rate hike next month is "complete" and "solid."
federal reserve may 50 basis point interest rate increase chances, mary daly
278
2022-34-20
Wednesday, 20 April 2022 02:34 PM
Newsmax Media, Inc.

Sign up for Newsmax’s Daily Newsletter

Receive breaking news and original analysis - sent right to your inbox.

(Optional for Local News)
Privacy: We never share your email address.
Join the Newsmax Community
Read and Post Comments
Please review Community Guidelines before posting a comment.
 
Get Newsmax Text Alerts
TOP

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved
NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved