Powell Sees Higher Peak for Interest Rates, Says Fed Prepared to Speed Up If Needed
- Traders switch bets to half-point hike at March meeting
- Fed chief says path to lower inflation ‘likely to be bumpy’
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Chair Jerome Powell said the Federal Reserve is likely to lift interest rates higher and potentially faster than previously anticipated with inflation persisting, an unexpectedly aggressive posture following last month’s step down in the pace of hikes.
The remarks, coming in testimony before Congress on Tuesday, opened the door to officials lifting the Fed’s benchmark lending rate by a half percentage point at the next meeting if upcoming reports on jobs and prices show rate hikes have done little to cool the economy.