Top policymakers in Boston and Philadelphia pushed back against market bets for an aggressive pivot, instead calling for a slow and steady approach.
Already a subscriber?Two US Federal Reserve officials said they believe it’s appropriate for the central bank to begin lowering interest rates soon, and that the pace of subsequent cutting should be “gradual” and “methodical”.
He added he wants more information before deciding whether a 25- or 50-basis point move would be appropriate next month. “It is problematic in my mind that the market is pricing in so many rate cuts right now,” El-Erian, the president of Queens’ College, Cambridge, told Bloomberg Television. “The market is overdoing it.”
“There’s this notion of a hard landing policy response to achieve a soft landing, that has got to be reconciled one way or another,” said El-Erian. “The market’s going to have to adjust at some point.”None of the three officials said their view on the economy was much changed by the Labor Department’s preliminary benchmark revision of payroll figures for the year through March 2024., the Bureau of Labor Statistics said on Wednesday.
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