Please ensure Javascript is enabled for purposes of website accessibility
More Interest Rate Hikes Needed, Says Federal Reserve Official
gvw_ap_news
By Associated Press
Published 2 years ago on
April 14, 2023

Share

Getting your Trinity Audio player ready...

A senior Federal Reserve official said Friday that there has been little progress on inflation for more than a year and that more interest rate hikes are needed to get prices under control.

Christopher Waller, a member of the Fed’s governing board, did not specify how many more increases he supports, but said that inflation “is still much too high and so my job is not done.”

Last month, inflation slowed as food and gas prices fell, but excluding those volatile categories, “core” prices kept rising and are 5.6% higher than a year ago. Waller pointed out that core prices have risen at about that same pace, or higher, since December 2021.

Waller’s comments expressing support for more rate hikes follow a forecast by the Fed’s staff economists, revealed in Fed minutes Wednesday, for a “mild recession” later this year.

Waller said that, like most of his colleagues, he is closely watching whether the collapse of two large banks last month will lead to a broad cut back in lending by the banking system, which could slow the economy.

But so far it’s not clear how large the impact will be, he said, and job growth remains strong and inflation is far above the Fed’s 2% target, “so monetary policy needs to be tightened further.”

His comments, delivered in San Antonio, Texas, echo those of several of his colleagues, who have said in recent weeks that they support at least one more rate hike. That would put the Fed’s benchmark rate at about 5.1%, the highest in 16 years.

Waller also underscored that he supported keeping the Fed’s benchmark rate elevated for much longer than investors expect. Traders in interest-rate futures expect that the central bank will lift rates one last time at the Fed’s next meeting in May, and then cut them three times by the end of the year, according to the CME Fedwatch tool.

Those expectations likely reflect an assumption that the economy will tumble into a recession, forcing the Fed to pivot toward lower interest rates.

Waller, however, said that the slow progress on inflation meant that, “Monetary policy will need to remain tight for a substantial period of time, and longer than markets anticipate.”

Still, Waller did express some optimism, particularly about signs in Wednesday’s inflation report that showed rental price growth is finally slowing, after months of sharp gains. The number of new apartments under construction is at historically high levels and vacancies have ticked up, pushing developers to lower rents on new apartment leases.

Waller said as those trends continue to feed into government rental price data, inflation will fall further. By the end of this year it could reach as low as 3% to 3.5%, he said.

RELATED TOPICS:

DON'T MISS

What Are Fresno Real Estate Experts Predicting for 2025 and Beyond?

DON'T MISS

First California EV Mandates Hit Automakers This Year. Most Are Not Even Close

DON'T MISS

High School Dropout to Five Decades in Congress: Charles Rangel Dies at 94

DON'T MISS

A Former Aide Says Sean ‘Diddy’ Combs Kidnapped Her in a Plot to Kill Kid Cudi

DON'T MISS

RIP Local Broadcast Legend Marv Allen, 80, Longtime Voice of KVPR

DON'T MISS

Trump to Pardon Reality TV’s Todd and Julie Chrisley After Tax Evasion Conviction

DON'T MISS

Westlands Leader Calls Slight Water Boost ‘Disappointing’

DON'T MISS

Republican Tuberville Announces Bid for Alabama Governor

DON'T MISS

PG&E Sees Surge in AI Data Center Interest With Fresno Area Emerging as New Hotspot

DON'T MISS

SF-Based Salesforce Is Buying Informatica in $8 Billion Deal

DON'T MISS

Fresno Unified Safety Officer Alleges Battery by District Exec. What Does PD Say?

DON'T MISS

Tulare County Authorities Arrest 45 in Parole, Probation Sweep

UP NEXT

Trump Re-Escalates Trade Threats, Takes Aim at European Union, Apple

UP NEXT

Stop Making Cents: US Mint Moves Forward With Plans to Kill the Penny

UP NEXT

Gavin Newsom’s Off-the-Mark Budget Numbers Undermine His Credibility Again

UP NEXT

Average Rate on a US 30-Year Mortgage Rises to 6.86%, Its Highest Level Since Mid-February

UP NEXT

Stocks Drift as Worries About the US Government’s Soaring Debt Continue to Weigh

UP NEXT

Wall Street Stocks Slip as Treasury Yields Rise on Worries About Trump Tax Cuts

UP NEXT

US Army to Change Transgender Soldiers’ Records to Birth Sex

UP NEXT

Newsom’s Budget Cuts Anger Allies and Leave the State’s Chronic Deficit Unresolved

UP NEXT

Fresno Families Can’t Sell Their Gold Fast Enough: Jewelers

UP NEXT

Wall Street Drops, Treasury Yields Rise After Moody’s Downgrade

Trump to Pardon Reality TV’s Todd and Julie Chrisley After Tax Evasion Conviction

12 hours ago

Westlands Leader Calls Slight Water Boost ‘Disappointing’

13 hours ago

Republican Tuberville Announces Bid for Alabama Governor

13 hours ago

PG&E Sees Surge in AI Data Center Interest With Fresno Area Emerging as New Hotspot

13 hours ago

SF-Based Salesforce Is Buying Informatica in $8 Billion Deal

14 hours ago

Fresno Unified Safety Officer Alleges Battery by District Exec. What Does PD Say?

15 hours ago

Tulare County Authorities Arrest 45 in Parole, Probation Sweep

16 hours ago

Trump Administration Halts Scheduling of New Student Visa Appointments

16 hours ago

Trump Pardons Tax Cheat After Mother Attends $1 Million Dinner

16 hours ago

Eight More Drowning Deaths Added to Kern River Warning Signs

16 hours ago

High School Dropout to Five Decades in Congress: Charles Rangel Dies at 94

NEW YORK — Former U.S. Rep. Charles Rangel of New York, an outspoken, gravel-voiced Harlem Democrat who spent nearly five decades on Capitol...

11 hours ago

Charles Rangel Obituary
11 hours ago

High School Dropout to Five Decades in Congress: Charles Rangel Dies at 94

Sean "Diddy" Combs stands as he is arraigned on a superseding indictment ahead of his May trial on sex trafficking charges, in New York, U.S., March 14, 2025, in this courtroom sketch. (REUTERS/Jane Rosenberg?/File Photo)
11 hours ago

A Former Aide Says Sean ‘Diddy’ Combs Kidnapped Her in a Plot to Kill Kid Cudi

11 hours ago

RIP Local Broadcast Legend Marv Allen, 80, Longtime Voice of KVPR

Todd Chrisley (2nd L) speaks next to his wife Julie (L) and their kids Chase and Savannah at a panel for the USA television series "Chrisley Knows Best" during the Television Critics Association Cable Summer Press Tour in Beverly Hills, California July 14, 2014. REUTERS/Mario Anzuoni/File Photo
12 hours ago

Trump to Pardon Reality TV’s Todd and Julie Chrisley After Tax Evasion Conviction

13 hours ago

Westlands Leader Calls Slight Water Boost ‘Disappointing’

U.S. Senator Tommy Tuberville (R-AL) speaks at the Conservative Political Action Conference (CPAC) annual meeting in National Harbor, Maryland, U.S., February 22, 2024. REUTERS/Amanda Andrade-Rhoades/File Photo
13 hours ago

Republican Tuberville Announces Bid for Alabama Governor

Residents walk by power grid towers at Bair Island State Marine Park in Redwood City, California, United States, January 26, 2022. REUTERS/Carlos Barria/File Photo
13 hours ago

PG&E Sees Surge in AI Data Center Interest With Fresno Area Emerging as New Hotspot

Salesforce Tower in New York
14 hours ago

SF-Based Salesforce Is Buying Informatica in $8 Billion Deal

Help continue the work that gets you the news that matters most.

Search

Send this to a friend