Fed's Musalem: more rate firming will be "necessary, and soon"

St. Louis Fed President Alberto Musalem said on Oct. 30 that inflation is too high and more tightening is likely needed soon. He spoke two days after the Fed held its target range at 3.75% to 4.00%.

In this brief: 4 sections 2 min read

- "I judge that additional firming of monetary policy will be necessary, and soon." "Incremental adjustments made earlier are usually less disruptive than larger and abrupt actions taken later." "Inflation is too high, exceeding the FOMC's 2% target."
- In a Friday SiriusXM interview, Barkin said persistent inflation and resilient activity support further rate increases, per Investing.com. He favors a measured pace so officials can assess incoming data. The report paraphrases him and gives few direct quotes.
- The FOMC held its range at 3.75% to 4.00% on Oct. 28 after a September hike. Forbes Advisor lists Oct. 29 Treasury yields at 4.18% for the 3-month bill and 4.42% for the 1-year bill.
- Speeches signal direction but don't change rates. Savings and CD yields tend to follow expectations for the Fed's path, so hike talk supports current offers. The actual call comes at the Dec. 8–9 meeting.

Read full analysis on stlouisfed.org

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