Federal Reserve Bank of Atlanta President Raphael Bostic told CNBC on Tuesday that he expects one more rate increase before the policymakers decide to hold the elevated rates “for quite a while” as the inflation rate in the country still remains “too high.” The Federal Reserve official stated that it could take longer than expected to bring the inflation down to its 2% objective, but underscored that he does not expect the country’s economy to fall into a recession. “The economy has proven to be extremly resilient, outperforming expectations,” Bostic said, adding that the overall demand in the country has remained strong. “It is important that we get our balance sheet back down to a size that is appropriate,” he stressed, and underlined that the Fed will also continue to monitor the banking system for “signs of trouble.”
Barkin: More proof of inflation decline needed
Federal Reserve Bank of Richmond President Thomas Barkin said on Monday that he still needs to see more evidence that the inflation is subsiding and moving toward the United States central bank’s 2% goal. Speaking at an event hosted by the Richmond Association for Business Economics, Barkin noted he is reassured by the developments in the banking sector. The national economy is performing “just fine” with the current federal funds rate in place, he added.
ECB’s Rehn: We must carry on with rate hikes
European Central Bank policymaker Olli Rehn insisted on Friday that the ECB has to consistently continue rate hikes due to inflation still being “too high.” Speaking to CNBC, Rehn stressed the ECB must “carry on and act consistently” with its tightening policy. “Inflation is still by far too high, and especially I’m concerned about core inflation, underlying inflation,” he argued. “It’s important that we carry on and act consistently, but we have to calibrate our decision based on an approach based on data dependency,” Rehn commented on the latest data, which revealed inflation declined to 6.9% last month. However, core inflation surged to a record high of 5.7% at the same time. “We have been reaching restrictive territory, and it’s important that we don’t relax prematurely,” Rehn concluded. NN: