The majority of economists polled by Reuters predict that the U.S. Federal Reserve will not raise interest rates again, and they expect the central bank to wait until at least the end of March before cutting them, as the probability of a recession within a year falls to its lowest level since September 2022.
The minutes of the Federal Reserve meeting suggest that another rate hike in 2023 is possible, although the Fed does not mention lowering rates and intends to balance the risk of overtightening policy against the cost of insufficient tightening; the market is less inclined to believe that rate hikes will occur as predicted by the Fed, with a higher chance of rates staying steady in September and a lower chance of a hike in November.
Boston Federal Reserve President Susan Collins stated that the central bank may require additional interest rate hikes and will likely maintain elevated rates for an extended period, even if no further increases occur in the near future.
Hiking interest rates can discourage innovation and curtail long-term economic growth potential, according to a study presented at the Federal Reserve's annual conference. A percentage point increase in interest rates could lead to a 5% reduction in economic output, suggesting the need for increased government funding for innovation to offset rate increases. Higher interest rates make borrowing more expensive, reducing consumer and business demand and hindering the development of new offerings and efficiency-increasing innovations. Additionally, research and development spending, venture capital investment, and patents all decline with rising interest rates. However, the study does not advocate for refraining from raising rates if needed to control inflation.
Two Federal Reserve officials, Boston Fed President Susan Collins and Philadelphia Fed President Patrick Harker, suggested that the Fed may be nearing the end of interest rate increases, although Collins did not rule out the possibility of further hikes if inflation doesn't decline.
Federal Reserve Chair Jerome Powell stated that the strength of the U.S. economy may require further interest rate hikes to reduce inflation, despite uncertainties surrounding the economic outlook.
Cleveland Federal Reserve Bank President Loretta Mester believes that beating inflation will require one more interest-rate hike and then a temporary pause, stating that rate cuts may not begin in late 2024 as previously thought.
Federal Reserve Chairman Jerome Powell signaled at a conference of central bankers that more rate hikes could be on the way as the economy continues to run hot, despite a series of policy tightening measures, in an effort to combat persistent inflation.
The Bank of England may have to increase interest rates if the US Federal Reserve decides to raise rates to cut inflation, in order to prevent the pound from weakening and inflation from rising further.
Investors have been building up bets on the Federal Reserve announcing an end to its rate hikes, but the central bank's preferred inflation data and Chair Jerome Powell's comments suggest that the cycle may not be over yet.
The Federal Reserve is considering raising interest rates again in order to reduce inflation to its targeted levels, as indicated by Fed Governor Michelle W. Bowman, who stated that additional rate increases will likely be needed; however, conflicting economic indicators, such as job growth and wage growth, may complicate the decision-making process.
The former president of the Boston Fed suggests that the Federal Reserve can stop raising interest rates if the labor market and economic growth continue to slow at the current pace.
Atlanta Federal Reserve Bank President Raphael Bostic argues against further U.S. interest rate hikes, stating that current monetary policy is already tight enough to bring inflation back down to 2% over a reasonable period and cautioning against the risk of tightening too much.
The latest inflation data suggests that price increases are cooling down, increasing the likelihood that the Federal Reserve will keep interest rates unchanged in their upcoming meeting.
The Federal Reserve's preferred inflation gauge increased slightly in July, suggesting that the fight against inflation may be challenging, but the absence of worse news indicates that officials are likely to maintain interest rates.
Federal Reserve policymakers are not eager to raise interest rates, but they are cautious about declaring victory as they monitor data such as inflation and job growth; most do not expect a rate hike at the upcoming policy-setting meeting.
Bond traders are anticipating that the Federal Reserve will continue with interest-rate hikes, and next week's consumer-price index report will provide further insight on how much more tightening may be required to control inflation.
Rising energy costs are predicted to contribute to an increase in inflation rate, but it is unlikely to prompt the Federal Reserve to raise interest rates, though there may be another rate hike in the future.
J.P.Morgan Asset Management predicts that there will be no more interest rate hikes from the U.S. Federal Reserve due to downward-trending inflation data.
The Federal Reserve is expected to maintain one more rate hike on the table in their updated forecasts, despite their growing faith in the prospect of an economic soft-landing.
Goldman Sachs predicts that the Federal Reserve will not raise interest rates at its upcoming annual meeting due to favorable inflation news and projected economic growth, but they expect a further hike later in the year.
A survey conducted by Bloomberg shows that most economists expect the Federal Reserve to hold interest rates steady until May and project one additional rate increase this year, although they do not believe the Fed will actually implement another increase.
Federal Reserve officials are expected to keep interest rates unchanged at their policy meeting this week but will leave the door open for another rate hike, as they remain cautious about inflation and aim to keep financial conditions tight.
The Federal Reserve is expected to signal that another rate hike may be necessary due to strong economic growth and inflation metrics, creating a difference of opinion between the equity and bond markets.
The Federal Reserve is expected to announce a pause on interest rate hikes due to positive economic indicators and the likelihood of a "soft landing" for the economy, but future decisions will be influenced by factors such as the resumption of student loan payments and a potential government shutdown.
The Federal Reserve has indicated that interest rates will remain "higher for longer," potentially for at least three more years, in order to sustain economic growth and combat inflation.
Central banks around the world may have reached the peak of interest rate hikes in their effort to control inflation, as data suggests that major economies have turned a corner on price rises and core inflation is declining in the US, UK, and EU. However, central banks remain cautious and warn that rates may need to remain high for a longer duration, and that oil price rallies could lead to another spike in inflation. Overall, economists believe that the global monetary policy tightening cycle is nearing its end, with many central banks expected to cut interest rates in the coming year.
The possibility of a last hike in 2023 with the pause in interest rates in September may lead to the tightening and financial conditions that were not seen earlier when the Fed was raising rates faster.
Federal Reserve policymakers Governor Michelle Bowman and Boston Fed President Susan Collins expressed the need to keep interest rates elevated to combat inflation, with Bowman suggesting further rate hikes will likely be needed to bring inflation down to the Fed's 2% target and Collins stating that further tightening is not off the table as progress in battling inflation has been slow.
