Federal Reserve Bank of Philadelphia Governor Anna Paulson said she is in favor of gradually raising interest rates, adding that wage pressure is limited and inflation expectations are still in line with the central bank's 2% target. Paulson said at an event organized by the Federal Reserve in Philadelphia on Tuesday, “For now, further gradual policy tightening seems appropriate.” She added, “If inflation expectations rise, wage pressure increases, or potential inflation rises, I would like to act more quickly. But at the moment, I haven't seen this happen.” Federal Reserve officials kept the benchmark interest rate unchanged in the 3.75% to 4% range last month after they raised interest rates by 0.25 percentage points in September. Since the October meeting, many policymakers have said that further policy tightening is needed to keep the inflation rate within the target range of 2%. Paulson said, “If a meeting doesn't act, it's just a matter of pace, not direction. There may be more work to be done. But I prefer to gradually tighten the policy as conditions permit.” She added that a slower pace would give households, businesses, and the financial sector time to make adjustments, while also giving policymakers time to evaluate data. She said, “When policy direction is clear, a step-by-step approach works best. If the market expects policies to be tightened further, then a gradual approach will not leave us behind our goals.”
Zhitongcaijing · 3d ago
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Federal Reserve Bank of Philadelphia Governor Anna Paulson said she is in favor of gradually raising interest rates, adding that wage pressure is limited and inflation expectations are still in line with the central bank's 2% target. Paulson said at an event organized by the Federal Reserve in Philadelphia on Tuesday, “For now, further gradual policy tightening seems appropriate.” She added, “If inflation expectations rise, wage pressure increases, or potential inflation rises, I would like to act more quickly. But at the moment, I haven't seen this happen.” Federal Reserve officials kept the benchmark interest rate unchanged in the 3.75% to 4% range last month after they raised interest rates by 0.25 percentage points in September. Since the October meeting, many policymakers have said that further policy tightening is needed to keep the inflation rate within the target range of 2%. Paulson said, “If a meeting doesn't act, it's just a matter of pace, not direction. There may be more work to be done. But I prefer to gradually tighten the policy as conditions permit.” She added that a slower pace would give households, businesses, and the financial sector time to make adjustments, while also giving policymakers time to evaluate data. She said, “When policy direction is clear, a step-by-step approach works best. If the market expects policies to be tightened further, then a gradual approach will not leave us behind our goals.”
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