Fed Is Likely to Shy Away From Calling Interest-Rate Peak Next Week
Federal Reserve Chairman Jerome Powell and his colleagues are likely to shy away from signaling that they’re done raising interest rates when they meet next week.
With inflation still above its 2% target and economic growth solid, US central bankers probably will retain a bias toward tighter policy at their Sept. 19-20 meeting even as they hold rates steady.
“There’s no way they’re going to signal they’re done here,” said Bruce Kasman, chief economist at JPMorgan Chase & Co.
That’s in contrast to the somewhat muddy message that came from the European Central Bank on Thursday as it increased rates by a quarter percentage point.
While ECB President Christine Lagarde declined to say whether rates had peaked, investors took the central bank’s post-meeting policy statement as signaling that European policymakers are finished raising rates. The euro fell and bonds rallied as traders marked down the odds of another ECB rate increase.