By Michael S. Derby
NEW YORK, Oct 1 (Reuters) – Federal Reserve Vice Chair Philip Jefferson said on Thursday that while he supported the US central bank’s interest rate increase last month, he does not see any urgency to make another move.
“Any future adjustments in policy should be determined by carefully examining trends in the data, the evolving outlook, and the balance of risks,” Jefferson said in the text of remarks to be delivered before the University of Virginia’s Darden School of Business.
Noting that markets are “reassessing” the outlook amid rising bond market yields, he said “my colleagues and I will need to come to our own judgment, which may take more time” before making the call on the next rate move. “With more data in hand, such trends may lend themselves to better discernment, as may the appropriate stance of monetary policy,” Jefferson said.
The Fed lifted its benchmark interest rate by a quarter of a percentage point to the 3.75%-4.00% range at its September 15-16 meeting, while releasing forecasts that projected another increase in rates before the end of 2026.
New York Fed President John Williams on Tuesday said he saw no urgency in raising rates as policymakers take in more data, though he added that he still expected a hike before the end of this year.
Financial markets broadly expect the Fed to hold rates steady at its October 27-28 meeting.
Jefferson said he sees inflation staying “elevated” in the near term “before resuming its decline toward our 2% goal as the effects of energy and other price shocks fade.” But he added, “I view risks to my inflation forecast as tilted to the upside due to recent geopolitical developments and stronger-than-anticipated aggregate demand.”
He said the risks to economic activity and the job market are “roughly balanced,” adding that the economy is “likely to show continued resilience … by adding jobs and extending a six-and-a-half-year-long expansion.”
(Reporting by Michael S. Derby; Editing by Paul Simao)
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