Fed’s Barkin Says Central Bank ‘Will Do What It Takes’ to Curb Inflation
Bloomberg
Published Aug 19, 2022 09:34AM ET
Updated Aug 19, 2022 10:00AM ET
Fed’s Barkin Says Central Bank ‘Will Do What It Takes’ to Curb Inflation
(Bloomberg) -- Federal Reserve Bank of Richmond President Thomas Barkin said the central bank was resolved to curb red-hot inflation and that there is a risk the efforts could cause a US economic recession.
“We’re committed to returning inflation to our 2% target and we’ll do what it takes to get there,” Barkin said Friday during an event in Ocean City, Maryland. He said that this could be achieved without a “tremendous decline in activity” but acknowledged that there were risks.
“There’s a path to getting inflation under control but a recession could happen in the process,” he said.
The US central bank hiked interest rates by 75 basis points in July for the second straight month as policy makers tackle inflation that’s running near 40-year highs. Fed officials speaking in recent days have said more rate increases are needed, but they are still deciding how big to move at their next policy meeting.
St. Louis Fed President James Bullard, one of the most hawkish policy makers, on Thursday urged another 75 basis-point move while Kansas City’s Esther George struck a more cautious tone.
Barkin said last week that he was undecided on whether the Federal Open Market Committee should raise rates by 50 basis points or 75 basis points in September. A Labor Department report for July showed that the US economy added 528,000 jobs that month, more than double what forecasters were projecting, and the unemployment rate ticked down to 3.5%, matching the pre-pandemic low.
But a separate report on Aug. 10 showed that consumer prices rose 8.5% in the 12 months through July, down from the 9.1% increase in the year to June that had marked the highest inflation rate since 1981. Officials will be able to review another jobs report and one more inflation reading before they meet next month.
©2022 Bloomberg L.P.
Get The News You Want
Written By: Bloomberg
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.