Cleveland Fed President Beth Hammack believes that high inflation should make the central bank cautious about another rate cut. The Fed will make its next interest rate decision on December 10 during its last Federal Open Market Committee (FOMC) meeting of the year.
Meet Your ETF AI Analyst
- Discover how TipRanks' ETF AI Analyst can help you make smarter investment decisions
- Explore ETFs TipRanks' users love and see what insights the ETF AI Analyst reveals about the ones you follow.
“After last week’s meeting, I see monetary policy as barely restrictive, if at all, and it’s not obvious to me that monetary policy should do more at this time,” said Hammack in prepared remarks for an Economic Club of New York event.
Hammack Expects Higher Inflation as Fed Considers Next Move
Hammack said that she opposed last week’s 25 bps rate cut to the 3.75%-4.00% range, reasoning that inflation remains above the Fed’s inflation target of 2%. In addition, she expects higher unemployment during the next few months and inflation to return to 3%, despite “accommodative” financial conditions.
A 25 bps rate cut next month is the likely outcome with 70.9% odds, according to CME’s FedWatch tool. The odds received a boost on Thursday after Challenger, Gray & Christmas reported 153,074 job cuts in October, the highest number for the month since 2003.
Stay ahead of macro events with our up-to-the-minute Economic Calendar — filter by impact, country, and more.