Fed's Brainard: Taming inflation may not cause big job cuts
Federal Reserve Vice Chair Lael Brainard said Thursday that high inflation in the United States is easing and suggested it was possible that the Fed’s interest rate hikes could slow price acceleration without causing significant job losses
WASHINGTON (AP) — Federal Reserve Vice Chair Lael Brainard said Thursday that high inflation in the United States is easing and suggested it was possible that the Fed's interest rate hikes could slow price acceleration without causing significant job losses.
Speaking in Chicago, Brainard sketched out a more optimistic outlook for inflation than some Fed speakers have in recent days.
At the same time, Brainard cautioned that inflation is still high and said the Fed would have to keep borrowing rates elevated “for some time” to curb price growth. She did not explicitly signal whether she would support a quarter-point or half-point rate increase in the Fed's benchmark short-term rate at the Fed's next meeting Jan. 31-Feb. 1.
But Brainard suggested that smaller rate hikes would make it easier for the Fed to gradually assess how rate hikes were affecting inflation and the overall economy. Most economists think the Fed will raise its key by a quarter point at the next meeting. That move would follow a half-point rate increase in December and four three-quarter-point hikes before that.
