SF Fed's Daly says 'a couple' more rate hikes are likely this year to fight inflation

The head of the San Francisco Federal Reserve said a key U.S. interest rate is likely to be raised a “couple” of a more times this year to combat “persistently” high inflation.“I think it’s a very reasonable projection to say a couple of more rate hikes will be necessary,”... The head of the San Francisco Federal Reserve said a key U.S. interest rate is likely to be raised a “couple” of a more times this year to combat “persistently” high inflation.

While some parts of the economy such as manufacturing have retrenched, other industries are still going strong, especially in services such as travel and recreation. The labor market is also quite robust, with the unemployment extremely low at 3.6%. The Fed is aiming to restore inflation, now running between 4% to 5%, to pre-pandemic levels of 2% or so. It’s raised a key short-term U.S. interest rate to a top end of 5.25% from near zero a year earlier.

The Fed is primed to keep raising rates until the economy slows even further and the central bank is convinced high inflation is going away.

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