Chances are the US central bank will take longer to get to its peak policy rate — or that it will need to pick up the pace of rate rises, Larry Summers said.
Former Treasury Secretary Lawrence Summers said that a broadening in US price pressures shows that the Federal Reserve’s monetary tightening to date is having a limited impact, raising the danger of policymakers having to do more than previously envisioned.
“The Fed is going to have to view the situation with a lot of humility,” said Summers, a Harvard University professor. At the same time, Summers said it’s too soon to advocate for the Fed to re-accelerate its rate hikes to a 0.5 of a percentage point move at the March policy meeting. “The Fed is going to have to view the situation with a lot of humility,” said Summers, a Harvard University professor. It should “avoid locking itself in with any kind of strong pronouncements”.showed a pickup in price pressures, with the headline gauge rising 0.5 per cent from the month before, the most since October.
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