Moody’s: Fed's inflation fight remains a priority, but financial stability risks complicate rate path

Anil Panchal FXStreet

Global rating giant Moody’s crossed wires, via Reuters, late Wednesday as it conveys the guidance for the global central banks, especially for the US Federal Reserve (Fed), amid the Credit Suisse turmoil.

“Expect the Federal Open Market Committee (FOMC) to raise the federal funds rate by 25 basis points at its March 22 meeting, said Moody’s per Reuters.

Additional comments

If banking stress intensifies, the Fed may well pause rate hikes to assess the situation.

Fed and other central banks could convene emergency meetings to provide guidance and stem the potential panic.

Financial markets are likely to remain volatile over the coming weeks.

Market reaction

The news tries to placate the risk-off mood and can do so during the generally inactive early Asian trading hours.

Also read: Sources: Large US banks view Credit Suisse exposure as manageable – Reuters

Author

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

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