{"id":438489,"date":"2026-09-22T01:23:33","date_gmt":"2026-09-21T18:23:33","guid":{"rendered":"https:\/\/www.swingfish.trade\/blog\/market-news\/st-louis-feds-musalem-interest-rates-likely-need-to-rise-further-to-tame-inflation-438489\/"},"modified":"2026-09-22T01:23:33","modified_gmt":"2026-09-21T18:23:33","slug":"st-louis-feds-musalem-interest-rates-likely-need-to-rise-further-to-tame-inflation","status":"publish","type":"post","link":"https:\/\/www.swingfish.trade\/blog\/market-news\/st-louis-feds-musalem-interest-rates-likely-need-to-rise-further-to-tame-inflation-438489\/","title":{"rendered":"St. Louis Fed\u2019s Musalem: Interest rates likely need to rise further to tame inflation"},"content":{"rendered":"<div>\n<p dir=\"auto\" class=\"PDq2pG_selectionAnchorContainer\">Comments from St. Louis Fed\u2019s Musalem cross the wires:<\/p>\n<ul>\n<li>\nWithout further policy restraint, it is more likely inflation will remain substantially above the 2% target 18 months from now.\n<\/li>\n<li>\nInterest rates likely need to rise further to tame inflation that is both demand- and supply-driven.\n<\/li>\n<li>\nLabor market stable around full employment and not a source of inflation pressure.\n<\/li>\n<li>\nCommodity shock is more than just oil, includes base metals like copper.\n<\/li>\n<li>\nBetter for rate hikes to be \u201cearlier and incremental\u201d rather than \u201clater and larger.\u201d\n<\/li>\n<li>\nEven when stripping out supply-related factors, inflation is still \u201ctoo high\u201d at up to 3%.\n<\/li>\n<li>\nBusiness contacts say they are planning on price increases \u201ccloser to 3%.\u201d\n<\/li>\n<\/ul>\n<p dir=\"auto\">Analysis: The message from Musalem is clearly hawkish. He believes inflation could remain well above the Fed\u2019s 2% target without additional policy restraint, and he favors acting sooner with smaller rate increases rather than waiting and potentially having to move more aggressively later.<\/p>\n<p dir=\"auto\">For traders, the important distinction is that Musalem does not view inflation as solely the result of temporary supply disruptions. He sees pressure from both demand and supply, while reports of businesses planning price increases closer to 3% raise concerns that inflation expectations could remain sticky. That keeps the possibility of further Fed tightening firmly on the table.<\/p>\n<p dir=\"auto\">The market is pricing in a 55% chance of a Fed hike in October.<\/p>\n<p>                            This article was written by Greg Michalowski at investinglive.com.<\/p><\/div>\n","protected":false},"excerpt":{"rendered":"<p>Comments from St. Louis Fed\u2019s Musalem cross the wires: Without further policy restraint, it is more likely inflation will remain substantially above the 2% target 18 months from now. Interest rates likely&hellip;<\/p>\n","protected":false},"author":216,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[86],"tags":[],"class_list":["post-438489","post","type-post","status-publish","format-standard","hentry","category-market-news"],"_links":{"self":[{"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/posts\/438489","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/users\/216"}],"replies":[{"embeddable":true,"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/comments?post=438489"}],"version-history":[{"count":0,"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/posts\/438489\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/media?parent=438489"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/categories?post=438489"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/tags?post=438489"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}