Fed’s Bostic: Could use half-point rate rises if needed – FT

In an interview with the Financial Times (FT) on Sunday, Atlanta Federal Reserve (Fed) President Raphael Bostic said he could lean towards a 50-basis point (bps) rate hike, depending on the economic data.

Key quotes

Every option is on the table for every meeting.

If the data say that things have evolved in a way that a 50-basis point move is required or [would [ be appropriate, then I am going to lean into that.

Comfortable with moving in successive meetings.

Sticks to 3 rate increases in 2022 with the first in March.

Will be looking for deceleration in monthly CPI price gains.

Looking for further evidence that rising wages are not feeding meaningfully into higher inflation.

Encouraged by latest employment cost index and expects a moderation in wage growth going forward.

Markets are acting rationally and responding with tighter financial markets.

Supports reducing the $9T balance sheet as quickly as possible without impairing market functioning.

Optimistic on the economy.

If we do three hikes, that'll still leave our policy in a very accomodative space.