Washington, Feb 22 (EFE).- The United States Federal Reserve calculates that it will have to maintain the pace of its restrictive monetary policy for a good part of 2023 and does not rule out increasing it if necessary to keep inflation going down.
This is underlined by the Fed in the minutes of the meeting held on January 31 and February 1, when it decided a new rise in interest rates -the eighth consecutive-, although 0.25 points, less than the previous ones .
The members of the Open Market Committee were clear from the beginning of this meeting that it was necessary to raise interest rates again, although there was also an agreement from the beginning that said rise should be slowed down.
The Fed will maintain its strategy
“The restrictive policy would need to be maintained until the data shows that inflation falls substantially and is on its way to 2%,” the objective set by this institution. And that, the committee members added, “will probably take a while,” the minutes say.
There are no expectations in the minutes of stopping rate rises in the short term, nor is there any assurance that the slowdown in said rises will be able to be sustained.
The members of the committee, thus, agreed to be “prepared” to change the pace of the increases if “risks” emerge that could impede the main objective of reducing inflation.
“Notable uncertainties”
The minutes do not contain discrepancies on monetary policy, although there are different views on the course of the economy.
Many committee members estimate a slowdown in U.S. economic growth, though some continue to speak of a “mild recession in 2023,” and most stressed the “notable uncertainties” that lie ahead, from a larger-than-expected decline to inflation.” persistent”.
And although in their macroeconomic analysis they speak of “modest” growth in both spending and activity, they also underlined the strength that the labor market continues to maintain despite the already agreed rate hikes.
They also agreed that the Russian invasion of Ukraine continues to cause a “tremendous human and economic cost” and continues to contribute to high global uncertainty. That is why they promised to remain “very attentive” to inflationary risks.
