Cleveland Fed President Loretta Mester said in a speech yesterday, “in my view, inflation, which is at a 40-year high, is the number one challenge for the U.S. economy at this time.”
“Given the underlying strength in the economy and the current very low level of the funds rate, I find it appealing to front-load some of the needed increases earlier rather than later in the process because it puts policy in a better position to adjust if the economy evolves differently than expected,” she said.
Mester expects interest rate to be at around 2.50% by the end of 2022. That would require some 50bps hikes at the upcoming meetings.
