The FED is walking a tight rope between keeping up momentum to fight inflation Vs over tightening, which could lead to recession. The indicators that they use as guidance are lagging. The most prudent way forward is to have small increments in rates and analyse the effect of the initial aggressive tightening. Powell faces pressure from the senate comm., who in turn must deal with populist politics. It points to a 25bp hike next. There is always the option to scale up again if needed.
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