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Karl W. Smith

The Fed Needs to Delay Its Rate Hikes

The war in Ukraine makes the central bank’s job more difficult but also more straightforward. 

A tough road ahead.

A tough road ahead.

Photographer: Tom Williams/CQ Roll Call

The U.S. Federal Reserve is widely expected to raise interest rates by at least a 25 basis points next week. And if inflation stays high, the Fed is “prepared to raise by more than that” in the coming months, Chair Jerome Powell said last week.

That would be a mistake. After next week’s hike, the Fed should hit pause for at least the next several months and possibly through the summer — even though the war in Ukraine will no doubt make inflation worse in the U.S.