Fed’s Mester sees Benchmark Rate above 4% and No Cuts at Least through 2023

Kon How
2022-09-01

Mester said she sees benchmark interest rates rising above 4% by early next year.

She sees benchmark rates rising above 4% in the coming months. That’s well above the current target range of 2.25%-2.5% for the federal funds rate, which sets what banks charge each other for overnight borrowing but is tied to many consumer debt instruments.

“My current view is that it will be necessary to move the fed funds rate up to somewhat above 4 percent by early next year and hold it there,” “I do not anticipate the Fed cutting the fed funds rate target next year.”

Her expectation with higher interest rates from here:

• Slow economic growth, running “well below 2%”

• Unemployment rate rises

• Financial markets remain volatile

• Inflation to fall to a range of 5%-6% from 9.1%

Current interest or Fed fund rate at 2.5%, if 4% by end of the year, with the remaining 3 FOMC meetings, it should be a combination between 0.25%, 0.5% and 0.75%。

Though global inflationary pressure seems no sign of easing, there are some silver linings to note.

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Modified in.2022-10-14
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Comments

  • cfybao
    2022-09-02
    cfybao
    first time for decades, seeing rates on uptrend and breaking previous resistance in 2018.
  • Coyotero
    2022-09-02
    Coyotero
    8 of november will be the moment to drop
  • luckyjas
    2022-09-01
    luckyjas
    just when I want to sell... all going down
  • wei rong
    2022-09-01
    wei rong
    也没见股市怎么跌
  • 小辉goPro
    2022-09-01
    小辉goPro
    if yes then Great for all
  • 潘小明
    2022-09-01
    潘小明
    Great read
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