Philadelphia Fed President Patrick Harker suggests interest rate hikes are at an end
Philadelphia Federal Reserve President Patrick Harker on Tuesday indicated that the central bank could be at the end of its current rate-hiking cycle.
A voter this year on the rate-setting Federal Open Market Committee, the central bank official noted progress in the fight against inflation and confidence in the economy.
«Absent any alarming new data between now and mid-September, I believe we may be at the point where we can be patient and hold rates steady and let the monetary policy actions we have taken do their work,» Harker said in prepared remarks for a speech in Philadelphia.
That statements comes after the FOMC in July approved its 11th hike since March 2022, taking the Fed's key interest rate from near-zero to a target range of 5.25%-5.5%, the highest in more than 22 years.
While projections committee members made in June pointed to an additional quarter-point hike this year, there are differences of opinion on where to go from here. New York Fed President John Williams also indicated, in an interview with the New York Times published Monday, that the rate increases could be over. Governor Michelle Bowman said Monday that she thinks additional hikes are probably warranted.
Markets are pricing in more than an 85% probability that the Fed holds steady at its Sept. 19-20 meeting, according to CME Group data. Pricing action indicates the first decrease could some as soon as March 2024.
Harker indicated there are unlikely to be rate cuts anytime soon.
«Allow me to be clear about one thing, however. Should we be at that point where we can hold steady, we will need to be there for a while,» he said. «The pandemic taught us to never say never, but I do not foresee any likely circumstance for an immediate easing of the
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