Former Fed Vice Chairman: The Central Bank can continue to raise interest rates because the economy is still too strong

Richard Clarida, former Vice Chairman of the Fed, said that the Central Bank may have to continue to raise interest rates to fight inflation in the context that the economy is still too strong.

According to data from CME Group, traders forecast that the Fed will almost certainly not raise interest rates at the November 2023 meeting (98.3% probability), but there is a 22% probability of raising it in December 2023.

The consultant at Pimco said the Fed's biggest challenge is deciding when to lower interest rates.

“The interesting situation would be for the Fed to start cutting interest rates when inflation has not returned to 2%,” he said. “Mr. Powell may like inflation at 2.1%, but in reality it may only go down to 2.6%, 2.7%. Next summer, if inflation reaches this threshold, the Fed may think about reducing interest rates. The question is whether this happens in early 2024 or later, because inflation remains so persistent.” $BTC $BNB $ETH