(Reuters) – The U.S. Federal Reserve is expected to start raising rates — which are close to zero — in March and could comfortably raise them to 1.25% by the end of the year to help contain the slump. inflation but continue to support the economy, San Francisco Fed President Mary Daly said on Monday.
“If you get to that point, let’s say that’s the reality, that’s a good squeeze, but there’s also a little bit of accommodation left in the system because the terminal interest rate is 2.5%, so you’re supporting the economy. , not completely taking away the stimulus and causing disruption, but taking away some of the extraordinary accommodations that we provide,” Daly said in an interview with Reuters Breakingviews.
“I think balance is the appropriate thing to do with the uncertainty we face.”
(By Ann Saphir and Lindsay Dunsmuir)
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