Federal Reserve Chairman Jerome Powell on Thursday joined the chorus of other U.S. central bankers who want to move faster on raising interest rates.
“It is appropriate in my view to be moving a little more quickly,” Powell said, during a discussion hosted by the International Monetary Fund in Washington D.C.
“I also think there’s something in the idea of front-end loading,” when moving away from the central bank’s easy money policy, he said.
In March, the Fed hiked its benchmark interest rate for the first time in three years to a range of 0.25-0.5%. Officials think a rate around 2.4% is “neutral” meaning policy won’t be boosting the economy at all.
The Fed is committed to getting inflation back to its 2% target, he said.
In March, the Fed laid out a path of steady, but slow rate hikes, but over the last month, officials have expressed a need to move more aggressively with almost all expressing support for a 50 basis point move in May. Traders in the Fed funds futures markets are pricing in another 50 point rate hike in June.
Powell wouldn’t be more specific about the May meeting, saying officials will announce the move after their two-day discussions, but he did not push back on the consensus.
“I think markets are processing what we’re saying, they’re reacting appropriately generally, but I wouldn’t want to bless any particular market pricing,” he said.