United States Federal Reserve Bank of Minneapolis President Neel Kashkari (pictured) remarked on Monday that there is a “close call” at the central bank on whether the Federal Market Open Committee (FOMC) should pause the raises in interest rates or continue with them. Speaking to CNBC, Kashkari estimated the Fed might need to raise the key rate above 6%. He stressed that inflation in services appears to be “pretty darn entrenched” while noting that the job market remains robust. He also noted he is not “seeing evidence yet” that the crisis in the banking sector is “doing our work for us” regarding inflation. Kashkari also briefly commented on the negotiations between US President Joe Biden and House Speaker Kevin McCarthy on raising the debt ceiling, saying the central bank “cannot protect the economy from a debt default.”
Fed’s Bullard sees two more rate hikes in 2023
Federal Reserve Bank of St. Louis President James Bullard stated on Monday that he expects two more 25 basis point interest rate increases in 2023. Speaking at the American Gas Association 2023 Financial Forum, Bullard specified that earlier Fed projections that estimated interest rate peak at between 5% and 5.25%, where they actually stand now, were based on the assumptions that inflation would drop fast and that United States economic growth would be around zero. However, both of those predictions have failed to materialize so far, he pointed out. Bullard also claimed that the likelihood of a recession is “overstated” and that the US economy is still seeing “fairly robust growth.” NNI: It is clear the Fed is not done raising . Rates will go north off 6%. And their is no guarantee that six will be enough,,,,,,,, Its the Teflon economy.
Dimon warns everybody should be prepared for higher rates
JPMorgan Chase & Co. CEO Jamie Dimon underlined on Monday, speaking at the company’s Investor Day, that everyone should be prepared for interest rates to go higher from here on. “There’s a chance you could have rates ticking up and not just 3.78,” Dimon said, adding that interest rates could go as high as 6% or 7%. Meanwhile, commenting on the banking turmoil, he stated that the moves the regulators made with regard to the Silicon Valley Bank will lead to smaller banks facing tighter credit.