Philadelphia Fed President Patrick Harker said in an FT interview, “I currently have three increases in for this year, and I’d be very open to starting in March. I’d be open to more if that’s required.”
“We don’t want to put the brakes on completely, but we do need to slow down some of the demand,” he said. “We can do something . . . by raising the fed funds rate.”
“Ultimately, what we worry about is that people start to think, ‘Well, inflation is just not going to be at 2 per cent, it’s going to be at 2.5 per cent or 3 per cent going forward’,” he said.
As for the balance sheet run-off, Harker said if could start once interest rates were “sufficiently away” from zero. “I am very much in the camp of communicating over and over how we’re going to do this and then being methodical,” he said.
