10/6/2022, 7:39 PM (Source: TeleTrader)
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Fed's Cook: Front-loading rate hikes positive

Federal Reserve Governor Lisa Cook pointed out on Thursday that introducing larger interest rate increases in the early stages of tightening the monetary policy, or front-loading, has "several positive features." Front-loading is a "preemptive approach" that enables a quicker reduction of demand and it can help "rein in" inflation expectations, Cook said in a speech at the Peterson Institute for International Economics in Washington DC.

According to the Fed official, the labor market is "very strong," but "inflation remains stubbornly and unacceptably high" and broad-based inflation pressures suggest "that the overall economy is very tight, with constrained supply continuing to fall short of demand." Echoing similar statements from her Fed colleagues, Cook stated that "ongoing rate hikes" and maintaining a restrictive monetary policy "for some time" are likely going to be necessary to restore price stability.

Baha Breaking News (BBN) / MS