Weekend – Fed’s Mester sees another interest rate hike, says cuts may have to wait

Loretta Mester is President and CEO of Federal Reserve Bank Cleveland branch. She spoke with Reuters in an interview at the Fed’s conference in Jackson Hole, Wyoming on Saturday.

  • does not want policy so tight that the economy collapses
  • wants to set it so that inflation reaches the Fed’s 2% goal by the end of 2025 … “We just don’t want it to keep drifting farther out”

Mester added that in June she had penciled in rate cuts in the second half of 2024, but that fresh forecasts are submitted ahead of the September Federal Open Market Committee (FOMC) meeting hat might change:

  • “I’m going to have to reassess that because, again, it’s going to be, how quickly do you think inflation is moving down?”
  • Fed’s next and possibly last rate hike “doesn’t necessarily have to be September, but I think this year”

Mester is not a voting member of the FOMC this year but will be in 2024.

The September meeting is on the 19th and 20th:

This article was written by Eamonn Sheridan at www.forexlive.com. Source