Federal Reserve's Moussali: Current interest rate setting remains appropriate

MeNews · 2026-04-08T07:21:55+00:00

St. Louis Fed President James Bullard stated that the current 3.5%-3.75% interest rate target is appropriate given the uncertain economic conditions and that the Fed may choose to cut or raise rates depending on economic developments. He noted that this rate target is near the lower end of the neutral zone, and further rate cuts could push inflation higher.

MeNews

2026-04-08 07:21:55

Abstract generation in progress

ME News message, on April 1 (UTC+8), on Wednesday, St. Louis Fed Chair Musalem said the Federal Reserve’s current interest-rate stance is likely still appropriate for the foreseeable future, and he may support the next round of rate cuts or hikes depending on how the economy develops. Musalem said the Fed’s interest-rate target of 3.5%-3.75% is a good balance when facing risks such as persistent inflation and a labor market showing fragile signs that have emerged in recent months. The interest-rate target may be at the lower end of the neutral range, which suggests that if the Fed were to cut rates further, it could unintentionally push inflation higher. Musalem noted: “Policy can effectively address the risks of the dual mandate. I expect the current policy interest-rate level will remain applicable for some time.” He said that if the labor market weakens and rate cuts would not damage the Fed’s credibility in fighting inflation, he may ultimately support further rate cuts. But he also said that if inflation rises, or if the public loses confidence in the Fed’s ability to respond to inflation, he may support rate hikes. (Jin Ten) (Source: ODAILY)

View Original

This page may contain third-party content, which is provided for information purposes only (not representations/warranties) and should not be considered as an endorsement of its views by Gate, nor as financial or professional advice. See Disclaimer for details.

2 Likes