The Fed: Fed’s Daly says more rate hikes needed, dismisses ‘pivot’ talk

by | Oct 5, 2022 | Stock Market

The Federal Reserve needs to keep raising its benchmark interest rate in order to cool inflation that hit a 40-year high earlier this year and has shown little signs of cooling, Mary Daly, president of the Federal Reserve Bank of San Francisco said Wednesday. “I do see more rate increases as necessary,” Daly said, in an interview on Bloomberg Television.

“Remember, this is all about bringing demand – which is very strong – back in line with supply and bringing inflation down,” Daly added. She said the central bank was data dependent and she hasn’t made a decision about what she wants the central bank to do at its next meeting in early November. The Fed has lifted its benchmark rate at an historic pace this year – raising the rate by 300 basis points from close to zero in March. At its last meeting in September, the Fed penciled in raising its benchmark interest rates by about 125 basis points before the end of the year. Traders who use futures contracts to bet on the pace of Fed rate hikes are wagering that the central bank will hike rates to a range of 4.5%-4.75% by next March but then cut rates by the fall. Daly said she thought this path was wrong. “I don’t see that happening at all. I see us raising to a level that we believe …

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