Fed to keep interest rates above 4% beyond 2023 – FT-IGM Survey
|According to the majority of leading academic economists polled by the Financial Times (FT) in partnership with the Initiative on Global Markets (IGM) at the University of Chicago’s Booth School of Business, the US Federal Reserve bank (Fed) is seen raising above 4% and holding it there beyond 2023.
Key takeaways
“Nearly 70 percent of the 44 economists surveyed between September 13 and 15 believe the fed funds rate of this tightening cycle will peak between 4 percent and 5 percent, with 20 percent of the view that it will need to pass that level.”
“Most of the respondents project core PCE will drop from its most recent July level of 4.6 percent to 3.5 percent by the end of 2023. But nearly a third expect it to still exceed 3 percent 12 months later. “
“Another 27 percent said “it was about as likely as not” to remain above that threshold at that time — indicating great unease about high inflation becoming more deeply embedded in the economy.”
“Nearly 70 percent of the respondents expect the National Bureau of Economic Research — the official arbiter of when US recessions begin and end — to declare one in 2023, with the bulk holding the view it will occur in the first or second quarter.”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.