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March 24 (Reuters) - Richmond Federal Reserve Bank
President Thomas Barkin said on Friday that he did not have
second thoughts about the U.S. central bank's decision earlier
this week to raise its main interest rate by 25 basis points.
"Inflation is high. Demand hadn't seemed to come down. And
so, the case for raising was pretty clear," Barkin said in an
interview with CNN published on their website.
The Fed raised its benchmark overnight interest rate to the
4.75%-5.00% range on Wednesday, despite recent banking turmoil
that had scrambled expectations of what the central bank would
do.
While Fed Chair Jerome Powell said at a press conference on
Wednesday that policymakers had considered a pause in light of
the banking stresses, Barkin appeared less concerned.
"For me, the question was: Do you see such stresses
happening that you felt like you really had to pull back and
learn more?" said Barkin. "It felt very stable by the time we
got there. So, the conditions were right to do monetary policy
the way we want to do monetary policy."
Fed policymakers overall did, however, recast their outlook
from a hawkish preoccupation with pricing pressures to a more
cautious stance to account for the fact that a tightening of
credit conditions resulting from a change in banks' behavior may
have the equivalent impact of the Fed's own rate hikes.
That said, Barkin added that he was maintaining his focus on
bringing down inflation, which is still running at 5.4% by the
Fed's preferred measure, far above the 2% target rate.
"People really want us to get control of inflation. That's
what they want us to do. We're the guys charged to do it,"
Barkin said.
(Reporting by Lindsay Dunsmuir; Editing by Franklin Paul and
Marguerita Choy)
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