San Francisco Fed President Daly says higher rates 'are likely to be needed' in inflation fight
Daly called Friday's jobs report "good news for American workers," but noted the pressure inflation is exerting on household finances
San Francisco Federal Reserve President Mary Daly made comments on Friday that suggest interest rates may need to rise further in order to combat inflation. While she described the latest jobs report as "good news for American workers," she also acknowledged the strain that inflation is placing on household finances. This is a key concern for the Fed, as it seeks to balance the need to support economic growth with the need to keep inflation in check.
Daly's comments are significant because they suggest that the Fed may not be done with its rate-hiking cycle yet. The central bank has already raised rates several times this year in an effort to combat inflation, which has remained stubbornly high despite some recent signs of moderation. If the Fed were to raise rates further, it could have implications for the broader economy, including the stock market and the bond market. Fund managers will be watching closely to see how the Fed's actions impact their investments.
Looking ahead, investors will be paying close attention to upcoming economic data releases, including the Consumer Price Index (CPI) and the Personal Consumption Expenditures (PCE) price index, which are both due out in the coming weeks. These reports will provide important insight into the state of inflation and may influence the Fed's decision on future interest rate moves. Fund managers will also be watching for further comments from Fed officials, including Chair Jerome Powell, for any clues about the central bank's future policy plans.
Originally reported by cnbc.com. FundNews adds analysis for finance & markets readers.