Fed officials signal more rate increases ahead; Logan wants two more quarter-point hikes (Oct 30)
What happened
Three Federal Reserve presidents publicly called for higher interest rates on Friday, directly pushing back against Chair Kevin Warsh's more dovish outlook and cementing market expectations of a December hike. Dallas Fed President Lorie Logan — a voting member of the FOMC this year — said Friday she would like to see two more quarter-percentage-point rate increases 'in the near future.' Their comments came just two days after the Fed voted 10-2 to hold rates at 3.75%-4.00%, and investors now see roughly a 73% chance of a hike at the December 8-9 meeting, according to the CME FedWatch tool. The December meeting is the Fed's final gathering before a more dovish cohort of regional presidents rotates onto the rate-setting committee in January.
Why it matters & what’s next are part of Pro, along with the audio summary.
Start your free 14-day trialWho’s affected
- Rate-sensitive growth/tech (higher-for-longer repricing), banks and regional lenders (net interest margin dynamics), utilities and REITs (discount-rate drag), homebuilders (mortgage-rate channel)
Sources