Dallas Fed president Lorie Logan expressed her support for an additional rate hike next month, adding to the ongoing divisions within the US Federal Reserve regarding inflation targets. The central bank has already raised its benchmark lending rate 10 times since last year to address inflation that has remained well above the desired two percent mark.
Speaking at a banking conference in Texas, Logan emphasized that more progress is needed to achieve the target inflation rate. Her stance aligns with three other members of the Federal Open Markets Committee (FOMC), who believe that raising rates again on June 13-14 may be necessary.
However, some officials, including Chicago Fed president Austan Goolsbee and Fed governor Philip Jefferson, have advocated for a wait-and-see approach when it comes to interest rates. Jefferson, the White House's nominee for the vacant number 2 position at the US central bank, stated that although inflation is high, the slowdown in GDP growth should be taken into account. He cautioned against expecting immediate results from higher interest rates, citing historical data.
Recent data from CME Group indicates that futures traders are assigning a higher probability to an interest-rate hike next month compared to a few days ago. Nevertheless, the odds of the Fed maintaining its benchmark lending rate still stand at over 60 percent.
