TechFlow News, June 18: Richard Fisher, Vice Chairman of Goldman Sachs and former President of the Dallas Federal Reserve, stated that if inflation remains persistently high, the Federal Reserve may need to raise interest rates as early as September. Kaplan said: “If inflation data does not cool down between now and September, it would be prudent for the Fed to act in September or this fall—that would be the safer course.” Following Fed Chair Jerome Powell’s hint that the central bank remains focused on fighting inflation, market sentiment turned hawkish. Traders sold short-term Treasuries, pushing up certain yields. Powell’s remarks were reinforced by individual projections from Fed officials, with half of them expecting rate hikes before year-end.
Kaplan added that if inflation remains stubborn, it indicates monetary policy is still too accommodative. He also noted: “The Fed’s policy moves are rarely one-offs; rate hikes typically occur in series of two or three. So, if you act in September, you need to be prepared—there could be one or two more hikes.” (Jinshi)
