The Federal Reserve's decision on Wednesday to hold interest rates steady or hike them is one of the most unclear in years.
Renewed tensions in the Middle East have pushed oil prices higher again, feeding the hawks' worries that energy prices could translate into sticky, broad-based inflation and necessitate a rate hike. At the same time, the latest inflation report showed prices cooled, giving the central bank some breathing room and bolstering the case to hold rates steady.
Former Kansas City Fed president Esther George said there's a 50-50 chance the Fed will either hold rates steady or raise them.
"The arguments you could create for them holding or raising seem pretty valid, but Kevin Warsh is not going to give you any tidbits to lead in the direction he wants to go," George said in an interview.
"It wouldn't surprise me if they hiked by 25 basis points at this meeting," George added. "The two-year [Treasury yield] is higher than the fed funds rate, so that may be enough to move people, but I think September is more likely in this sense."
#hold #hike #federal
Renewed tensions in the Middle East have pushed oil prices higher again, feeding the hawks' worries that energy prices could translate into sticky, broad-based inflation and necessitate a rate hike. At the same time, the latest inflation report showed prices cooled, giving the central bank some breathing room and bolstering the case to hold rates steady.
Former Kansas City Fed president Esther George said there's a 50-50 chance the Fed will either hold rates steady or raise them.
"The arguments you could create for them holding or raising seem pretty valid, but Kevin Warsh is not going to give you any tidbits to lead in the direction he wants to go," George said in an interview.
"It wouldn't surprise me if they hiked by 25 basis points at this meeting," George added. "The two-year [Treasury yield] is higher than the fed funds rate, so that may be enough to move people, but I think September is more likely in this sense."
#hold #hike #federal
2 months ago
