Are the Fed's Williams and Lacker's rate increases realistic?


Business, Change & Transformation

Nick Cudbill, one of our financial markets industry experts, shares his thoughts on the Fed's Williams and Lacker most recent statements...

So the Fed’s William’s and Lacker are still talking about 2-4 rate hikes in 2016, not forgetting we’re in April already, with the latter citing core inflation. Whilst employment continues to climb, this isn’t feeding into inflation in a consistent way, see the -0.3 fall in Retail Prices today, against an expected rise of 0.1, and Wholesale Prices fell for the 2nd month running also.

Combined with the uncertain global economic backdrop, it’s hard to see how they can justify such a quick rise in rates, especially as Williams said they should do so gradually!