While Raphael Bostic, Chairman of the Atlanta Federal Reserve Bank, said that the central bank may pause aggressive rate hikes in September, Fed minutes show the opposite.
Raphael Bostic said on Monday, May 23, that the central bank’s response to a scenario where inflation fell more than expected during the summer months. September per month may suspend aggressive rate hikes stated.
Fed’s monetary policy unit Federal Open Market Committee (FOMC), June and july policy rate in 50 basis points the lower band of the “neutral” stance, which the Fed neither supports nor constrains growth. 1.75% to %2nd It is expected to increase the target range. The Fed has also kept its balance sheet monthly until September as a second method to tighten policy. 95 billion dollars will shrink.
the Fed’s 20-21 September As Bostic said it would be “logical” at the meeting to be held on inflation has slowed down significantly. and Signs that the US economy has cooled enough to reduce future price pressures will need to be met.
Fed Chairman Jerome PowellOn May 17, the authorities stated that the inflation has receded.clear and convincing” promised to keep raising interest rates until evidence is found.
Fed minutes say otherwise
Minutes of the last meeting released by the Fed on May 25Raphael Bostic‘of Thoughts that the Fed may suspend aggressive rate hikes just the opposite Fed may go further in rate hikes laid out their expectations.
The Fed said in the minutes that officials 50 basis pointsIn addition to agreeing on the increase in similar rate hikes that it may be necessary and that the Fed a policy that is neutral (within the framework of market expectations) He gave his statements about the fact that he may need to act beyond monitoring.
Markets, Fed’s end of the year 2.5% to 2.75%While it is predicted that the policy rate will move within the range of 12.5% (which is described as the neutral stance of the Fed), the statements of the FOMC officials in the minutes are on the agenda with the interest rate hikes to be made by the FED until the end of the year. to rise above this Indicates that it is ready.
Billionaire Investor Bill Ackman: Stock markets could crash if the Fed doesn’t make aggressive rate hikes
Billionaire hedge fund manager and founder of Pershing Square Capital Management Bill Ackmanin his tweets on Tuesday, May 24, one day before the Fed minutes are released. If the Fed does not make aggressive rate hikes, stock markets may collapse. told.
Believing that inflation is out of control, the billionaire said that the market would do the Fed’s job if the Fed did not take steps to correct inflation by applying “aggressive monetary tightening”. The US economy could collapse is thinking.
Inflation is out of control. Inflation expectations are spiraling out of control. Because investors don’t believe the Fed can stop inflation. If the Fed doesn’t do its job, the market will do the Fed’s job, and that’s exactly what’s happening right now. Today, the way to stop inflation is aggressive monetary tightening or a collapse in the economy.
Aggressive interest rate hikes also affected the cryptocurrency markets
the Fed’s for the first time in December of last year. After stating at the meeting he held that he understood that inflation is not temporary and giving the signals that he could increase interest rates in 2022, crypto money markets, 25-26 January priced in a possible interest rate hike until the first meeting of the dates, bitcoin (BTC) $33,100 had fallen to levels.
(Bitcoin chart, lines indicate Fed meeting dates.)
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