Fed Official Paulson Says Another Rate Hike May Be Needed
Paulson cited stubborn core inflation, resilient economic activity and a shift in inflation risks before the September policy meeting.
Federal Reserve official Paulson said another interest-rate increase may be needed to bring down persistent inflation, a signal that could weigh on crypto and broader markets.
Paulson said underlying inflation remains stubbornly high and that the balance of inflation risks changed before the Federal Reserve’s September policy meeting. The comments point to continued concern that price pressures have not eased enough.
A rate increase in September would help shift monetary policy into a more effective position for fighting inflation, Paulson said. The official also pointed to a resilient economy showing signs of stronger growth momentum.
Higher interest rates generally tighten financial conditions by increasing borrowing costs and reducing the appeal of riskier assets. The Federal Reserve’s policy stance remains a key driver for market expectations, including crypto trading conditions.
