Waller, Fed Board Member, "Support for a Few More 0.5%P Rate Hikes... Ready to Go Beyond Neutral"

[Asia Economy New York=Special Correspondent Joselgina] The U.S. central bank, the Federal Reserve (Fed), has reiterated its stance that it will raise the benchmark interest rate by 0.5 percentage points several times in the future, pushing it above the neutral rate.

According to economic media CNBC on the 30th (local time), Fed Governor Christopher Waller stated in a speech held in Frankfurt, Germany, "We will not withdraw the 0.5 percentage point rate hike proposal until inflation approaches the target of 2%." He mentioned that he supports the 0.5 percentage point rate hikes over the next several times.

This aligns with the content revealed earlier in the May Federal Open Market Committee (FOMC) minutes, which indicated that a 0.5 percentage point increase could be pursued in June and July as well. It reconfirms that there is a widespread consensus within the Fed that the current benchmark interest rate of 0.75?1.00% needs to be rapidly raised to the neutral rate level or higher.

Governor Waller emphasized, "If the data suggests stubbornly high inflation, we are ready to do more," and "I support maintaining the policy rate above the neutral rate until the end of this year to curb inflation." The neutral rate is the interest rate at which the economy can achieve its potential growth rate without inflationary or deflationary pressures, and the market estimates it to be around 2.5%. Recently, the U.S. Consumer Price Index (CPI) has shown an 8% level, the highest in 40 years.

This content was produced with the assistance of AI translation services.