(Washington) An official of the American central bank (Federal Reserve, Fed) pointed out on Wednesday that inflation in the United States, at its highest in more than 40 years, could have peaked, and then begin to slow down.
Posted at 5:01 p.m.
“I think we could be at the top” of inflation, said Christopher Waller, one of the governors of the Fed, on the CNBC channel, anticipating “a slowdown in the coming months”.
The CPI inflation index, on which pensions are notably indexed, reached 8.4% over one year in March, its fastest pace in more than 40 years. The Fed, however, favors another indicator, the PCE index, which rose to 6.4% year on year in February, according to the most recent data available.
To combat this inflation, the powerful US Federal Reserve began at its last meeting in March to raise its key rates, which had been at their lowest since March 2020 to stimulate growth and therefore the economy, between 0 and 0 .25%.
Its leaders chose, in particular because of the uncertainties linked to the conflict in Ukraine, a first modest increase, opting for the usual quarter of a percentage point, and thus placing the rates between 0.25 and 0.50%.
The movement should however accelerate in the months to come.
Christopher Waller thus favors an increase of half a percentage point at the next meeting, on May 3 and 4. “And maybe again in June and July,” he added.
The Fed has not resorted to such a hike since 2000.
The governor considers it appropriate to approach “as soon as possible” the rate level considered neutral, i.e. 2.00 or 2.50%, and “exceed it […] probably by the second half of this year”.
” Fancy “
“We will do what it takes to bring down inflation,” he insisted, calling for taking advantage of the current strength of the American economy: “It’s a good time to do this kind of action aggressive because the economy can take it. »
But the American economy now finds itself caught between two dangers, inflation on the one hand, recession on the other.
Another voting member of the monetary committee, James Bullard, chairman of the St. Louis Fed, said in an interview with FinancialTimesthat it was “fantasy” to think that the American institution could sufficiently reduce inflation without raising rates to a level that is restricting the economy.
This “hawk”, in favor of an unaccommodative policy, believes that the Fed should be more aggressive in its tightening, and that reaching the so-called neutral rate “will not be enough”.
“Neutrality does not put downward pressure on inflation. It just ceases to exert upward pressure,” he said. However, “we need to exert downward pressure on the component of inflation that we think is persistent,” he added.
James Bullard had, at the March meeting, been the only one to vote against a quarter-point hike, believing that raising rates by half a point directly would have been more appropriate.