Central Bank Intervention

Persistently high inflation and the threat it might worsen is driving some analysts to argue the Federal Reserve must be more aggressive with interest-rate increases over time as it tries to use monetary policy to bring price pressures to heel. The latest round of upsized so-called terminal rate forecasts have arrived following the release of the August consumer-price index, which showed underlying levels of inflation grew worse that month. The data was a blow to the idea rooted in other recent reports…

OTTAWA—The Bank of Canada delivered another hefty increase to its main interest rate, taking it above 3% for the first time in over 14 years, and said rates need to go higher to tame inflation. The Bank of Canada on Wednesday lifted its overnight target rate by 0.75 percentage points to 3.25%, following a surprise full-percentage-point increase in July. Following five increases beginning in March, the central bank’s benchmark interest rate is now 3 percentage points higher than where it…

China’s central bank has cut the amount of foreign exchange banks must keep in reserve, an attempt to bolster the country’s rapidly weakening currency.The yuan is trading around its lowest level in more than two years. It is worth around 6.94 per U.S. dollar in the more freely traded offshore market, taking its year-to-date decline against the dollar to 8.4%, according to FactSet. The People’s Bank of China said on Monday it would cut the foreign-exchange reserve requirement ratio by 2 percentage points to 6% from Sept.…

Lorie Logan in her first comments as leader of the Federal Reserve Bank of Dallas on Wednesday said she agreed with other Fed officials that the central bank must focus on bringing inflation down. “Being president of the Dallas Fed and as a policy maker, our number one priority has to be to restore price stability,” Ms. Logan said as part of a video on her bank’s website. She didn’t, however, link that view on price pressures to specific policy actions in remarks largely aimed at explaining how she will…

Aug. 25, 2022 6:00 am ET Federal Reserve Bank of Atlanta President Raphael Bostic in an interview with The Wall Street Journal laid out his thinking about the Fed’s September policy meeting, his belief that markets are incorrectly betting on the central bank cutting interest rates, and how overseas events could affect the U.S. economy and monetary policy outlook. Here is a transcript, lightly edited for clarity. MICHAEL S. DERBY: So where I’d like to start out today is…

Economists believe that when Federal Reserve Chairman Jerome Powell speaks on Friday at the annual Jackson Hole research conference, he will need to thread a needle between signaling what the central bank must do soon regarding interest rates and what it needs to do with rates over the longer run. Addressing those questions means conditioning market expectations for the size of an almost certain interest rate increase in September, and what the Fed plans to do with rates longer term when recession…

Minutes of the Federal Reserve’s most recent policy meeting released Wednesday offered a warning about the central bank’s ability to keep funding its operations at a profit. In a document describing the proceedings of the July 26-27 Federal Open Market Committee meeting, a Fed staffer told policy makers that staff projections suggested the Fed’s net income “would likely turn negative in coming months.” Minutes of the Federal Reserve’s most recent policy meeting released Wednesday…

A slowdown in inflation last month, following recent indications of a robust labor market, complicates the Federal Reserve’s decision on how much to raise interest rates next month.Data on inflation and economic activity are likely to guide whether central bank officials lift their benchmark federal-funds rate by half a percentage point or three-quarters of a point at their Sept. 20-21 policy meeting. They have said they want to see evidence that price pressures and economic growth are cooling before they moderate their…

SÃO PAULO—Brazil’s central bank raised its benchmark interest rate as expected Wednesday, the 12th consecutive time, and said it would consider another rate increase at its next meeting in September. The bank’s monetary policy committee, or Copom, raised the Selic lending rate by a half point to 13.75%, the highest level in more than five years. The bank said in a statement that uncertainty about the global and domestic scenarios requires “additional caution” regarding its next steps.…

LONDON—The Bank of England raised its key interest rate by a half percentage point Thursday, the largest single step in more than a quarter-century, as the central bank follows the Federal Reserve in giving priority to the fight against inflation over the risk of hurting growth.In a statement, the bank raised its key rate to 1.75% from 1.25%. That means the bank has increased borrowing costs at six straight meetings of its monetary policy committee, its longest such streak since the late 1990s. Eight bank officials voted…