A top Federal Reserve official has warned it is far too early for the US central bank to “declare victory” in its fight against elevated inflation after new data showed a reprieve in consumer price pressures.
In an interview with the Financial Times, Mary Daly, president of the San Francisco branch of the Fed, did not rule out a third consecutive 0.75 percentage point rate rise at the central bank’s next policy meeting in September, although she signalled her initial support for the Fed to slow the pace of its interest rate increases.
Her comments come amid intense debate about how quickly the Fed will tighten monetary policy in the second half of 2022, after raising rates at the fastest pace since the early 1980s in the first half of this year. The federal funds rate, which hovered near zero in March, is now fixed between 2.25 per cent to 2.50 per cent.