News Digest: US Fed rate could hold after one more hike
April 15, 2023
The Federal Reserve could end its monetary tightening cycle with one more interest rate hike of 25 basis points in the hope that inflation would decline steadily in the coming weeks and months to their target of 2%, says a new report.
The report quotes Atlanta Fed president Raphael Bostic to suggest that recent inflation data shows a steady decline in consumer price increases in conjunction with falling producer price rise, both suggesting that the US economy was on the path towards a 2% inflation rate.
The Fed, which meets on May 2, to discuss the next course of action, could increase rates by a quarter of a percentage point, taking the benchmark overnight rate to the 5% to 5.25% range, one that hasn’t been witnessed in the US since the fall of 2007. Bostic was of the view that the rate hikes over 2022 have now started to bite the economy.