Harker: Fed is ready to move to 25-basis-point rate hikes

On Wednesday, Philadelphia Federal Reserve President Patrick Harker made a statement confirming his readiness for the U.S. central bank’s shifting to a slower pace of monetary tightening. This is linked to signs of cooling inflation.

As it was said by Harker, high inflation is a distress leading to inefficiency of the economy and causing harm to citizens with modest incomes. During his speech to a group in Newark, Delaware, Harker underlined that the Fed intends to achieve a moderate slowdown of the economy, as well as to make demand and supply more balanced to get inflation under control.

To achieve these goals, Harker expressed his readiness to increase the Fed's benchmark overnight interest rate beyond the present range of 4.25%–4.50%. It’s necessary to be reminded that Patrick Harker holds a voting role on the rate-setting Federal Open Market Committee in 2023.

Harker also added that he expects several rate hikes to be delivered during the current year. At the same time, he noted that sharp increases by 75 basis points, similar to the Fed’s tightening cycle of 2022, won’t happen.