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8/22, 4:25 PM (Source: TeleTrader)
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Fed's Harker: Yield curve inversion not the only signal of recession

Asked about the fears of recession sparked by recent yield curve inversions, President of the Federal Reserve Bank of Philadelphia Patrick Harker told CNBC on Thursday that the inversion might signal a recession but is definitely not the only signal to keep an eye on.

Harker confirmed the general attitude adopted by the FOMC that the trade uncertainty remains the biggest "headwind" for the economy, but pointed out that he would be "more worried" if the tariffs "kick in and hit consumers." For now, according to him, "nothing is moving dramatically in a negative direction."

The Philadelphia Fed head praised the labor market as "strong" and inflation which is moving up "slowly," pointing out that he does not see the need for any drastic action. "We should see how things play out," he said. "Fed is pretty much where we need to be," Harker underlined, noting that the US cannot ignore what is happening around the world. "Rates cannot get too far away from other global rates," the official emphasized.

Breaking the News / GG