|

Fed's Daly: I see more rate increases as necessary

San Francisco Fed President Mary Daly reiterated on Wednesday that the Fed is resolute at raising rates to restrictive territory, as reported by Reuters.

Additional takeaways

"We are committed to bringing inflation down, staying course until we are well and truly done."

"I don't see a hump shape in rates, I see us raising rates, holding them there until we get inflation close to 2%."

"More policy adjustments are required to get it restrictive."

"I see more rate increases as necessary."

"Expect inflation to end next year closer to 3% than 2%."

"Have to be prepared for inflation to be more persistent than we expect."

"Still seeing about 50% of inflation coming from demand."

"Markets are finding their footing."

"For us, the path is clear: we are going to raise rates to restrictive territory, then hold them there for a while."

"We don't raise rates until something breaks."

"We are constantly calibrating to risks."

"If market dislocation comes about, we would be prepared to address it."

"We will see on Friday if hiring is starting to slow."

"Firms are reducing vacancies, slowing the pace of hiring; right now we don't hear about layoffs."

"If Friday's data shows hiring is slowing, that would be a welcome piece of news."

"I'd like to see core prices stay flat or come down."

"Seeing core CPI flattening or coming down will be important to my decisions about the pace of policy increases."

Market reaction

The dollar rally continues following these comments and the US Dollar Index was last seen rising 1.3% on the day at 111.65.

Author

Eren Sengezer

As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.

More from Eren Sengezer
Share:

Editor's Picks

EUR/USD faces next resistance near 1.1930

EUR/USD has surrendered its earlier intraday advance on Thursday and is now hovering uncomfortably around the 1.1860 region amid modest gains in the US Dolla. Moving forward, markets are exoected to closely follow Friday’s release of US CPI data.
 

GBP/USD change course, nears 1.3600

GBP/USD gives away its daily gains and recedes toward the low-1.3600s on Thursday. Indeed, Cable now struggles to regain some upside traction on the back of the sudden bout of buying interest in the Greenback. In the meantime, investors continue to assess a string of underwhelming UK data releases released earlier in the day.

Gold plunges on sudden US Dollar demand

Gold drops markedly on Thursday, challenging the $4,900 mark per troy ounce following a firm bounce in the US Dollar and amid a steep sell-off on Wall Street, with losses led by the tech and housing sectors.

Ripple collaborates with Aviva Investors to tokenize funds as XRP interest declines

Ripple (XRP) exhibits subtle recovery signs, trading slightly above $1.40 at the time of writing on Thursday, as crypto prices broadly edge higher. Despite the metered uptick, risk-off sentiment remains a concern across the crypto market, as retail and institutional interest dwindle.

A tale of two labour markets: Headline strength masks underlying weakness

Undoubtedly, yesterday’s delayed US January jobs report delivered a strong headline – one that surpassed most estimates. However, optimism quickly faded amid sobering benchmark revisions.

Aster Price Forecast: Demand sparks on Binance Wallet partnership for on-chain perpetuals

Aster is up roughly 9% so far on Thursday, hinting at the breakout of a crucial resistance level. Aster partners up with Binance wallet for the second season of the on-chain perpetuals challenge.