Fed's Collins Signals Rates May Need to Rise Again

· Finance · United States

Federal Reserve Bank of Boston President Susan Collins said interest rates will likely need to rise more before the end of the year to help rein in inflation, speaking at a banking conference hosted by the Boston Fed. Her comments landed as Asian equities looked set to gain after US stocks recovered from session lows on signs the Fed may not need to raise rates aggressively next year, and as the 10-year Treasury yield fell after energy prices stabilized. Traders were also looking ahead to key economic data releases this week. Collins's guidance adds to an unusually murky rate outlook, in which officials weigh persistent inflation against signs of cooling. Markets are parsing every Fed comment for direction on the pace and endpoint of policy.

Why it matters：Fed guidance on the path of interest rates drives global borrowing costs, currency moves and asset valuations, so any signal of further tightening affects banks, corporates and investors worldwide.

Key points

  • Collins spoke at a banking conference hosted by the Boston Fed.
  • Her comments came as the 10-year Treasury yield fell after energy prices stabilized.
  • Markets were awaiting key economic data releases later in the week.

Sources (original reporting)

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