The Federal Reserve raised its benchmark interest rate and maintained its stance for three rate hikes in 2018, but one economist is suggesting an additional increase should be expected this year for a total of four hikes.
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“If I venture a prediction, there might be a four rate hikes in 2018,” Stern NYU Professor of Economics Nicholas Economides said Wednesday during an interview on FOX Business’ “Countdown to the Closing Bell.”
In his first press conference as Fed chair, Jerome Powell discussed the driving factors that are strengthening the U.S. economy and the labor market.
“The economic outlook has strengthened in recent months,” Powell said. “Several factors are supporting the outlook: Fiscal policy has become more stimulative; ongoing job gains are boosting incomes and confidence; foreign growth is on a firm trajectory; and overall financial conditions remain accommodating.”
Former Richmond Fed senior economist Ward McCarthy said Powell was cautiously hawkish and wants to continue to normalize policies as the economy normalizes.
“He doesn’t want to go so fast that he knocks over the apple cart, and I think he also tried to get us to focus on the big picture rather than splitting hairs,” McCarthy told FOX Business’ Ashley Webster.
The major averages finished lower in a volatile session after the Fed signaled a third rate hike in its 2019 plans. As widely expected, the central bank raised its benchmark lending rate by a quarter-percentage point to a range of 1.50% to 1.75%.