Posted on 02/16/2024 1:31:24 PM PST by RomanSoldier19
A wave of inflationary signals means that the Federal Reserve's next move could be a rate hike, former Treasury Secretary Larry Summers said.
"There's a meaningful chance, maybe it's 15%, that the next move is going to be upwards in rates, not downwards," Summers said during an interview on Bloomberg TV on Friday, adding that the Fed has to be "very careful."
His read on recent key inflation indicators in January, including a 3.1% year-over-year increase in the consumer price index and a 0.9% rise in the producer price index, formed the basis of his rationale. He added that the "soft-landing paradigm" has been called into question.
"It's always a mistake to over-interpret one month's number — and that's especially true in January, where calculating seasonality is difficult," he said. "But I think we have to recognize the possibility of a mini-paradigm shift."
(Excerpt) Read more at msn.com ...
A rate hike should be the next move but even with a hike the situation is going to get worse so a political consideration to stay the course or lower might be the reality. In other words, the ship is taking unusual amounts of water so why worry because it only a question of when not if the whole thing starts headed for the bottom.
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