The Fed is determined to stop wages from rising

AUSTIN, Texas (Project Syndicate)—Federal Reserve Chair Jerome Powell has now committed to putting monetary policy on a course of rising interest rates, which could boost the short-term rate (on federal funds (FF00) and Treasury bills (BX:TMUBMUSD03M) ) by at least 200 basis points by the end of 2024. Thus, Powell yielded to pressure from economists and financiers, resurrecting a playbook that the Fed has followed for 50 years—and that should have remained in its vault. The stated reason for tightening monetary policy is to “fight inflation.”

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