The Fed will be making a big mistake if it skips a rate hike this week, top economist Mohamed El-Erian warns
– would allow the central bank to observe another six weeks of economic data before deciding whether to press ahead with or pause its war on inflation.
But former PIMCO co-CIO El-Erian slammed the idea of a skip, warning that it's likely the Fed will learn little about how its efforts to tame soaring prices are faring between now and its next meeting, slated to start on July 25. "An additional month of data is unlikely to significantly enhance the Fed's understanding of the effects of a policy tool that acts with variable lags," he wrote.
"Recent data favours a hike for a central bank that has repeatedly insisted that it is 'data dependent'," El-Erian said, likely referring to economic releases including May's jobs report, which signaled thatRather than skipping a rate hike, the Fed should either raise borrowing costs again or signal that it's pausing its tightening campaign while adopting a new inflation target of between 3% and 4%, El-Erian added.
Canada Latest News, Canada Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Asia shares track Wall Street rally with US inflation data, Fed in focus By Reuters⚠️BREAKING: *ASIAN STOCKS RISE ACROSS THE REGION AMID GLOBAL RALLY, NIKKEI JUMPS TO 33-YEAR HIGH 🇯🇵🇦🇺🇨🇳🇭🇰🇰🇷🇮🇩🇮🇳
Read more »
Asian stocks buoyed by chipmakers as Fed, CPI data loom By Investing.com⚠️BREAKING: *ASIA STOCKS END HIGHER AS JAPAN'S NIKKEI CLOSES AT NEW 33-YEAR PEAK 🇯🇵🇦🇺🇨🇳🇭🇰🇰🇷🇮🇩🇮🇳
Read more »
U.S. inflation eases to 4.0% in May as key Fed decision looms By Investing.com⚠️BREAKING: *U.S. CPI EASED TO 4% IN MAY TO ITS LOWEST LEVEL IN OVER TWO YEARS 🇺🇸🇺🇸
Read more »
EUR/USD grinds near mid-1.0700s as Fed vs. ECB play gains attentionEUR/USD renews intraday low near 1.0750 as it pares the first weekly gain in five amid cautious mood ahead of the key week comprising the European Cen
Read more »
AUD/USD bulls struggle with 0.6750 hurdle on Australia holiday, US inflation, Fed eyedAUD/USD renews intraday high near 0.6745 but fails to print any impressive start of the key week amid Monday’s holiday in Australia. It’s worth noting
Read more »
US Dollar Index: DXY grinds near mid-103.00s as markets await US inflation, FedUS Dollar Index: DXY grinds near mid-103.00s as markets await US inflation, Fed – by anilpanchal7 DollarIndex Fed Inflation RiskAppetite SwingTrading
Read more »