Dudley: There are sufficient reasons for the Federal Reserve to raise interest rates, and a September rate hike may initiate a continuous cycle of rate hikes

Former New York Fed President Dudley stated that there are sufficient reasons for the Fed to tighten monetary policy, and that the September rate hike is not a one-time action, but the beginning of a series of consecutive rate hikes. Dudley pointed out that the US inflation rate is above the 2% target, the labor market is stable, and the core CPI rose by 0.3% month on month in August. Dudley expects that the Federal Reserve will provide a median expectation of two cumulative interest rate hikes of 25 basis points each in 2026 in the September economic forecast summary SEP. Dudley believes that if Federal Reserve Chairman Kevin Walsh decisively raises interest rates, it will help prove his determination to curb inflation and policy independence. Federal Reserve Chairman Kevin Walsh should not outsource monetary policy to financial markets. (Source: Federal Reserve)