By Michael Derby
NEW YORK (Reuters) – San Francisco Fed President Mary Daly said on Monday that if the U.S. central bank could raise its overnight target rate to 5 % above, inflation has not cooled, even if that is not the monetary policy outcome she expected.
“I tend to be on the more hawkish side of policymakers,” Daly told reporters on a conference call on Monday. While the Fed may stop raising interest rates next year when it hits its target, she said, with rates currently between 3.% and 4%, reaching 5%, if inflation doesn’t moderate, “we can go as far as we can go.” higher”.
Daly added that while there were signs that inflation may be starting to cool, it was “too early to call a turning point in price pressures”.
Daly also said that when it comes to the rate-setting FOMC meeting in December, “it’s too early to take anything off the table, in my view” , it is unclear whether another 75 basis point rate hike will be required, or whether the central bank will require a rate change of a different magnitude. Some policymakers have signaled an openness to small rate hikes following an aggressive path of rate hikes so far this year.
