Fed officials signal possible December rate hike
Several Federal Reserve officials have said rates may need to rise again, with December hike expectations rising. Markets now price a better than 80 percent chance of a December quarter-point hike.
IllustrationThe story so far
On Friday, St. Louis Fed President Alberto Musalem and Dallas Fed President Lorie Logan said rates would need to rise to rein in inflation. Musalem called for a hike soon, while Logan forecast at least two more quarter-point increases. Their remarks followed the Fed leaving rates unchanged on Wednesday and raised expectations for a December move, with futures pricing a 76 percent chance of a quarter-point hike.
San Francisco Fed President Mary Daly said the central bank will likely need to raise rates further, while leaving pace and timing uncertain. She spoke after October jobs added 165,000 and unemployment fell to 4.1 percent, with hourly earnings rising 3.1 percent annually against September consumer price index inflation of 3.7 percent. Daly said Americans are on a treadmill of high inflation and real wages are not keeping up.
Federal Reserve Governor Christopher Waller said the bank should follow through on rate hikes or risk credibility, leaning toward a December increase. He said a 50 basis point hike should be considered if inflation comes in higher than forecast, while a 25 basis point move could put credibility at risk. Markets price a better than 80 percent chance of a December quarter-point hike. US stock indexes ended lower, snapping a rally, as traders worried about a December rate hike. Tech stocks bounced after AI figures from CoreWeave, Anthropic and OpenAI.
Latest updates
4 updates · newest first- 11 NovNew development
Tech stocks bounce as AI results lift markets despite rate worries
US stock indexes ended lower on Tuesday, snapping a two-day rally, as traders worried about a larger Federal Reserve rate hike in December. Tech stocks bounced this week after bargain buying and strong AI figures from CoreWeave, Anthropic and OpenAI. The moves matter because investors are testing whether companies can keep financing heavy AI spending while borrowing costs rise.
Euronews ↗
- 10 NovNew development
Fed's Waller sees December hike likely, opens door to half-point increase
Federal Reserve Governor Christopher Waller said on Tuesday the bank should follow through on expected rate hikes or risk its credibility, and he is leaning toward a December increase even if October inflation is softer. He said a 50 basis point hike should be considered if inflation comes in higher than forecast, while a 25 basis point move could put credibility at risk. Markets price a better than 80% chance of a December quarter-point hike.
CNBC ↗
MarketWatch ↗
- 6 NovOfficial statement
Fed's Daly sees more rate hikes likely as inflation persists
San Francisco Fed President Mary Daly said the central bank will likely need to raise rates further, while leaving pace and timing uncertain. She spoke after October jobs added 165,000 and unemployment fell to 4.1 percent, with hourly earnings rising 3.1 percent annually against September consumer price index inflation of 3.7 percent. Daly said Americans are on a treadmill of high inflation and real wages are not keeping up.
- 30 OctNew development
Two Fed presidents say rates need to rise again
Two Federal Reserve presidents said on Friday that rates will need to rise to rein in inflation, with St. Louis Fed's Alberto Musalem calling for a hike soon and Dallas Fed's Lorie Logan forecasting at least two more quarter-point increases. The remarks came after the Fed left rates unchanged on Wednesday and boosted expectations of a December move, with futures pricing a 76% chance of a quarter-point hike.