Fischer: Interest Rates Seen Rising as Expected

Federal Reserve Vice Chairman Stanley Fischer said the central bank is nearing its dual goals and seems to be headed for the monetary policy path that officials had anticipated.

“I don’t want to give you numbers on two or three, but this is consistent with what we had thought should be happening around now — that is that we’d be moving closer to the 2 percent inflation rate, and that the labor market would continue to strengthen,” Fischer said when asked about the rate outlook Thursday on Bloomberg Television in an interview with Tom Keene. “If those two things happen, we’ll be on the path that we more or less expected.”

Fed officials are looking for three rate increases in 2017, based on the median in their most recent economic projections. Investors had expected this year’s first increase to come in June up until this week, but two days of relatively hawkish congressional testimony from Fed Chair Janet Yellen and a strong inflation reading for January have boosted expectations in markets for a rate increase as early as March or May.

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Craig Erlam

Craig Erlam

Senior Market Analyst - UK & EMEA at OANDA
Based in London, Craig Erlam joined OANDA in 2015 as a Market Analyst. With many years of experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while producing macroeconomic commentary. His views have been published in the Financial Times, Reuters, The Telegraph and the International Business Times, and he also appears as a regular guest commentator on the BBC, Bloomberg TV, FOX Business and BNN. Craig holds a full membership to the Society of Technical Analysts and is recognised as a Certified Financial Technician by the International Federation of Technical Analysts.
Craig Erlam