The Fed is expected to announce a Three-quarters of the percentage point rate rise For the fourth time in a row on Wednesday afternoon. But investors are hoping Federal Reserve Chairman Jerome Powell will suggest that the central bank will soon “focus” and slow the pace of rate hikes.
Those dreams may fade.
“I’m not convinced that Powell is backing down,” he said. Daniel DiMartino Booth, CEO and Chief Strategist, Quill Intelligence To CNN’s Alison Cusick on Wednesday View “Markets Now”. “It is his responsibility to continue the path.”
Di Martino Booth, who served at the Federal Reserve Board in Dallas for nine years, said she believes the Fed will continue to focus more on fighting inflation, especially since the labor market remains in good shape.
The Fed will remain vigilant about rising consumer prices, Rick Reader, Chief Investment Officer for Global Fixed Income at BlackRock, agreed.
“The pivot could be aggressive. We continue to suffer from high inflation and employment which is still strong,” Rieder told Kosik.
But Reeder said this could be the last price hike of this magnitude. That’s because past price increases are already having an impact on parts of the economy: “You see it in housing and you’ll see it soon in automobiles and other interest rate-sensitive sectors.”
Di Martino Booth is more concerned about the effect of raising prices.
“The Fed certainly has an impact on consumption,” she said, adding that “a recession is a pretty much imposed consequence.”
To make matters worse, she said, “There may be a long period of time during which we try to recover from this unusually large scale [rate] Hiking course.
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