Barkin, the Federal Reserve, is open to the resumption of a 50bp interest rate increase

According to reports, on March 11, Balkin, chairman of the FOMC Voting Committee and Richmond Fed in 2024, said in an interview on Friday that he had not made a decision on the upcoming interest rate increase (he had been advocating a 25 basis point interest rate increase) under the condition of continued inflation. At the same time, he also said, “At any particular meeting, I always said that I am open to any outcome”, and pointed out that he “will never give up any possibility”. “The last interest rate increase of 25bp does not mean that every meeting is 25bp”. Balkin’s statement echoes Powell’s testimony this week. At that time, Powell said that he was open to a new interest rate increase of 50bp if future data showed that it was necessary. With regard to the potential impact of the Silicon Valley banking incident on the Federal Reserve’s monetary policy, Balkin believed that he mainly focused on economic demand, and financial stability “may or may not affect”, “I will continue to respond until we control inflation”. He added that he would not be surprised if the economic forecast summary released at the March meeting was revised to be higher than the expected level of 5.1% in December last year. (Financial Times)

Interpretation of this information:

The Chairman of the FOMC Voting Committee and Richmond Fed, Balkin, recently gave an interview where he stated that he had not made a decision about the upcoming interest rate increase. Although he had previously advocated for a 25 basis point increase, he remained open to any outcome and would not give up any possibility. Balkin’s statement reflects Powell’s testimony this week, where he also stated that he was open to a new interest rate increase of 50bp if required. Balkin believes that the Silicon Valley banking incident may or may not affect financial stability, and thus, he focuses on economic demand while controlling inflation. According to him, he would not be surprised if the economic forecast summary released at the March meeting was revised to be higher than the expected level of 5.1% in December last year.