Fed Member Says No Rate Hike Until Global Slowdown Does Not Derail US Recovery

The Federal Reserve should hold off on any interest rate hike until it is clear that a global slowdown, trouble in China and other international risks will not push the U.S. recovery off course, Fed Governor Lael Brainard said on Monday in one of the strongest defenses yet of a go-slow approach to policy.

Brainard has been among the most vocal Fed members in her concern about the likelihood that economic trouble in China could blow back on the United States. She extended that argument on Monday into a discussion of how whole regions of the world are being impacted by China’s slowdown.

The risks that the rest of Asia and commodity exporters in general will grow more slowly because of weak demand in China means the United States faces a continued drag from lower exports, a stronger dollar and generally slack world economic conditions.


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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza