Federal Reserve Bank of Atlanta President Dennis Lockhart said he continues to expect the first interest-rate hike in nearly a decade this year, while cautioning that a stronger dollar, a weaker Chinese yuan and falling oil prices complicate the outlook.
“I expect the normalization of monetary policy —- that is, interest rates —- to begin sometime this year,” Lockhart said Monday in Berkeley, California, without citing a particular month. “Currently, developments such as the appreciation of the dollar, the devaluation of the Chinese currency, and the further decline of oil prices are complicating factors in predicting the pace of growth.”
Lockhart said on Aug. 10 that he thought the point of liftoff was “close” and told reporters that “from my perspective September remains a live possibility.”
Lockhart, who votes this year on monetary policy, has consistently sided with the Federal Open Market Committee majority, led by Chair Janet Yellen. Investors have lowered the probability of a central bank rate increase in September amid continued financial market turmoil and slowing growth in China.