Reuters
Hawkish Powell puts 50 bp Fed rate hikes back on table
The Federal Reserve will likely need to raise interest rates more than expected in response to recent strong data and is prepared to move in larger steps if the “totality” of incoming information suggests tougher measures are needed to control inflation, Fed Chair Jerome Powell told U.S. lawmakers on Tuesday. “The latest economic data have come in stronger than expected, which suggests that the ultimate level of interest rates is likely to be higher than previously anticipated,” Powell said in prepared remarks for a hearing before the Senate Banking Committee. U.S. stocks sold off, Treasury yields rose and the dollar extended a gain after Powell’s comments, his first since inflation unexpectedly jumped in January and the U.S. government reported an unusually large increase in payroll jobs for that month.
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