Fed's Powell signals smaller interest rate hikes could begin in December

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Federal Reserve Chairman Jerome Powell delivers remarks to investors and economists at the Fed’s annual symposium

Federal Reserve Chairman Jerome Powell delivers remarks to investors and economists at the Fed’s annual symposium.

Federal Reserve Chairman Jerome Powell said the U.S. central bank could slow its interest rate increases at its meeting next month, but stressed that policymakers have more work to do in order to crush stubbornly high inflation. 

"The time for moderating the pace of rate increases may come as soon as the December meeting," Powell said on Wednesday during a speech at the Brookings Institute in Washington. 

Still, he noted that "going increases will be appropriate" and that the focus on rate hike speed is less important than the question of how long rates should be held in restrictive territory.

The Fed raised rates by 75 basis points at the beginning of November for the fourth straight meeting as it tries to wrestle inflation closer to its 2% target with the most aggressive tightening since the 1980s. 

A majority of traders expect the Fed to approve a smaller half-point rate hike at the conclusion of a two-day meeting Dec. 14, with just 17% forecasting another super-sized, 75 basis point increase.

This is a developing story. Please check back for updates.
 

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