NY Fed Dudley Hopes CB Tightens Policy Later This Year

Economic performance will determine when the Federal Reserve finally raises U.S. interest rates from near zero, an influential Fed official said on Monday, adding he hopes to tighten policy later this year.
“We have to see what unfolds,” New York Fed President William Dudley said in a speech that repeated cautious optimism that the U.S. economy will continue to expand and that inflation will begin to firm later this year.

Still, he said, the economy has further to go toward the central bank’s dual goals of full employment and 2-percent inflation.

The data will “hopefully” support a rate hike later this year, Dudley said at the Bloomberg Americas Monetary Summit. But “the timing of normalization remains uncertain because how the economy evolves is also uncertain,” he added.

Dudley, a permanent voter on U.S. monetary policy and a close ally of Fed Chair Janet Yellen, repeated that the pace of tightening will depend on how financial markets react.

The Fed is expected to raise rates by June at the earliest but more likely in the second half of the year, according to forecasts by economists and Fed officials.

via CNBC

Content is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please access the RSS feed or contact us at info@marketpulse.com. Visit https://www.marketpulse.com/ to find out more about the beat of the global markets. © 2023 OANDA Business Information & Services Inc.