Financial expert: Fed banker rejects speculation about interest rate cuts. No stop-start monetary policy planned, says Mary Daly.

Financial expert: Fed banker rejects speculation about interest rate cuts. No stop-start monetary policy planned, says Mary Daly.

According to a report by www.n-tv.de, San Francisco Fed District President Mary Daly does not believe monetary easing is necessary at this time. She sees no need to discuss interest rate cuts and emphasizes that monetary policy should not switch back and forth between stop and start. She believes that the Fed should take sufficient restrictive measures to restore price stability. Her colleague, John Williams, confirms that the Fed is guided by the data and could consider further tightening if price pressures are more persistent than expected. However, the stock market currently expects that the Fed will continue to keep key interest rates in the range of 5.25 to 5.50 percent, but a first interest rate cut is likely in May 2024.

The statements made by Mary Daly and John Williams could have implications for the financial market and the financial industry. Tighter monetary policy could dampen the expectations of many investors on Wall Street, who previously expected a rate cut. This could lead to a decrease in demand for certain securities and investment products, while bond yields could increase. Companies that rely on cheap loans could find tighter monetary policy burdensome. On the other hand, savers and investors who rely on stable and attractive returns could benefit from a tighter monetary policy.

The announced forecast for a possible interest rate cut in May 2024 could lead to investors paying more attention to the development of interest rates and possibly adjusting their investment strategies. This could lead to increased volatility in financial markets as investors try to prepare for the expected changes.

Overall, the statements from the Fed banker and her colleague indicate that monetary policy in the USA remains closely linked to the development of inflation and the economic situation. This uncertainty could lead to increased sensitivity and reactivity in financial markets in the coming months.