Fed's Fischer still sees three rate hikes this year

Economy 4/21/2017, 5:58 PM
Fed's Fischer still sees three rate hikes this year

Two further interest rate increases by the end of this year would be appropriate, Vice Chairman of the United States Federal Reserve Stanley Fischer said on Friday in a live interview with CNBC. This stance holds up in spite of recent signs of a slowing economy, the policymaker explained.

Much of the slowness both in the US economy and in the inflation rate can be attributed to seasonal factors that will diminish as the year goes by, Fischer noted. Still, the Fed's monetary policy decisions are very much data-dependent so the central bank is not tied to three rate hikes, he added.

Fischer also criticized changes in financial regulations proposed by US President Donald Trump, warning that they could pose a serious threat to the financial system. "We seem to have forgotten that we had a financial crisis which was caused by behavior in the banking and other parts of the financial system," the rate-setter said. Taking actions to remove the reforms adopted in the wake of the crisis is "very dangerous," he concluded.

TeleTrader Newsroom / IB