Central Banks

Fed Should Consider a Half-Point July Rate Hike If June Is a Skip, Summers Says

Risks of overheating US economy are ‘primary’ for Fed
Former Treasury secretary speaks in interview on Bloomberg TV

Former US Treasury Secretary Lawrence Summers says the Federal Reserve should be open to raising its benchmark interest rate by 50 basis points in July if the central bank pauses its round of policy tightening this month. “If they don’t raise rates in June, I think they have to be open to the possibility that they may have to raise rates by 50 basis points in July,” he says on Bloomberg Television’s “Wall Street Week” with David Westin.Source: Bloomberg

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By Rich Miller

June 2, 2023 at 5:24 PM UTC

This article is for subscribers only.

The Federal Reserve should be open to raising interest rates by a half percentage point in July if it opts to hold off from tightening credit this month, former Treasury Secretary Lawrence Summers said.

“We are again in a situation where the risks of overheating the economy are the primary risks that the Fed needs to be mindful of,” the Harvard University professor said in an interview with Bloomberg Television’s David Westin on Friday.