The majority of the members of the Federal Open Market Committee of the Federal Reserve of USA (Fed) estimated in their last meeting that another interest rate increase will be necessary before the end of the year.
The US central bank published this Wednesday the minutes of its last meeting, held on September 19 and 20, and they state that “most participants felt that a further increase would probably be appropriate”although “some considered it likely that further increases would not be justified.”
After the eleven increases carried out since March 2022, the Fed decided on September 20 to pause the rate hikes, although it did not clarify whether there will be more increases before the end of the year in one of the two meetings that they still have. to be celebrated.
“The Committee would be willing to adjust the monetary policy stance as appropriate if risks arise that may impede the achievement of its objectives.”noted the US central bank after deciding to keep rates within the range of the 5.25% and the 5.5%its highest level since 2001.
The minutes explain that all participants agreed that the Committee is in a position to “proceed with caution” and that policy decisions at each meeting will continue to be based on emerging economic data and the “risk balance”.
All participants also agreed that monetary policy should remain “restrictive” for some time, until “The Committee trusts that the inflation is sustainably descending toward its goal.”
Last week it was announced that 336,000 jobs were created in September, 109,000 more than those created in August, the largest increase in employment in eight months, a figure that indicates that the labor market remains resilient despite the decisions of the Fed.
The Bureau of Labor Statistics (BLS) releases September inflation data tomorrow, which will be critical for future Fed decisions.
In August, the annual inflation rate in the United States accelerated for the second consecutive month to 3.7% in August, from 3.2% of July.
Source: Gestion
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