Philly Fed’s Harker: Rate Hike Cycle May Be Over

Messages from US Federal Reserve (Fed) executives regarding interest rate policy continue to arrive. Finally, Philadelphia Fed President Patrick Harker stated that the Fed may be at the end of the current rate hike cycle.

The Fed official, who is also a member of the Federal Open Market Committee, which sets interest rates, drew attention to progress in the fight against inflation and confidence in the economy.

‘If there is no alarming data…’

“If there is no new alarming data by mid-September, I think we may be at a point where we can be patient, keep interest rates stable, and let our monetary policy actions do their job,” Harker said in a speech. yesterday in Philly. .

Stating that there will be no rate cuts in the near future, Harker said: “Still, let me make one thing clear. If we’re at a point where we can sit still, we’ll need to be there for a while. The pandemic has taught us to never say ‘never’. However, I don’t envision a possible immediate policy rate reduction situation,” he said.

WHAT HAPPENED?

Policymakers have slowed the rate of interest rate rises after aggressive tightening measures to curb inflation, which hit a 40-year high last year.

The Fed raised interest rates by 25 basis points at its meeting on July 25-26, raising the federal funding rate to a range of 5.25 to 5.5 percent, the highest level in 22 years. This month’s increase came after the break in the June meeting.