Fed's tighter monetary policy hasn't dented inflation yet, Bostic says

Reuters via MSN ^ | November 15, 2022 | By Ann Saphir

[Oldeconomybuyer]

(Reuters) -Atlanta Federal Reserve President Raphael Bostic said on Tuesday he sees little evidence that the U.S. central bank's aggressive monetary policy tightening is slowing inflation, and borrowing costs will have to rise further for that to happen.

"Tighter money has not yet constrained business activity enough to seriously dent inflation," Bostic said in an essay posted on the Atlanta Fed's website. "I anticipate that more rate hikes will be needed" to get policy sufficiently restrictive to return inflation to the Fed's 2% target, he said.

Bostic did not indicate if he favored slowing the pace of future rate increases, or by how much more the Fed may need to increase its benchmark overnight interest rate beyond the current 3.75%-4.00% range.

But Bostic, like other Fed policymakers who have spoken recently, made clear that the central bank's battle to tame price pressures isn't over, and that rates would continue rising even at the risk of a broader economic slowdown.

Though Bostic said a recession could be avoided, he added that such a scenario "would be preferred to the alternative" in which inflation becomes entrenched.

There were, he said, "glimmers of hope" around some aspects of inflation, including a slowing pace of price increases for goods. But "we will need to see increases in services prices slow, too. So far we haven't."

[Kaiser8408a]

I know Bostic personally. He is the ultimate empty suit, script reader. So like Biden, someone behind the curtain is telling him what to say.

[joshua c]

the numbers i remember from the 80s were 21% prime to kill 13% inflation

with those numbers they need 12% prime to kill 8% inflation

[Parmy]

It takes quite awhile to dry up all the excess money that has been poured into the economy and world.

[Oldeconomybuyer]

>>> with those numbers they need 12% prime to kill 8% inflation <<<

National Debt hit $1 trillion in the early 80’s. We’re now servicing $32 trillion. Every 1% rate hike increases annual debt servicing cost by ~$320 billion.

We will have exhausted other peoples money well before we reach 12%.

Pray for America.

[oldasrocks]

The only way to lower inflation is to drill and open up more oil here. That was part of the driving costs and continuing to be.

[cgbg]

Yup—cold equations.

You need real positive interest rates.

[I want the USA back]

Milton Friedman says that the cause of inflation is the government issuing currency, and that raising interest rates is not the cure.

What biden is doing is not going to cure inflation. And there’s no sign of him being ready to stop spending money the government doesn’t have.

[Oldeconomybuyer]

Fiscal, FED, and energy policy are the three levers available to drive inflation down. Two are in the hands of incompetent anti-American marxists. And the other in the hands of a political FED chair.