Cleveland Fed President Beth Hammack warns inflation remains elevated, raising odds of a hawkish FOMC outcome later this month.
Cleveland Fed President Beth Hammack argued inflation remains too high and rates may need to rise further, reinforcing a hawkish stance ahead of the July 28-29 FOMC meeting. Her remarks, delivered before the blackout period, increase the likelihood of a contentious debate and potential dissent, echoing her April vote against policy easing.
Hammack estimated core PCE inflation likely rose 3.3% in June, while noting the labor market remains near maximum employment. Markets are pricing in a higher probability of a rate hike or a more hawkish statement, with traders closely watching signals from Chairman Kevin Warsh amid a divided Committee.
A hawkish outcome could bolster the dollar and lift short-term Treasury yields, while a dovish shift may reverse recent moves. The Fed’s blackout period begins today, silencing policymakers until the meeting concludes.