More Cautionary Statements from Fed Officials

Fair enough, they’re only saying what the agency has said following rating increases.

High-ranking Fed officials have recently been nagging observers, warning that markets should not expect a quick end to higher interest rates. This idea could be a concern for commercial real estate.

Esther George, the 40-year Federal Reserve veteran and head of the Federal Reserve Bank of Kansas City, told the Wall Street Journal that bringing down inflation without a recession could be near impossible.
George remarked, ” I’m looking at a labor market that is so tight, I don’t know how you continue to bring this level of inflation down without having some real slowing, and maybe we even have a contraction in the economy to get there.”

Fed Governor Christopher Waller has been cautioning that better-sounding news on the consumer price index when the October statistics came out has caused the “market to have gotten way out in front on this.”
Although on Wednesday he stated, “Looking toward the FOMC’s December meeting, the data of the past few weeks have made me more comfortable considering stepping down to a 50-basis-point hike. But I won’t be making a judgment about that until I see more data, including the next PCE inflation report and the next jobs report.”

Waller continued, “If the FOMC were to step down to a 50-basis-point increase, it is important to remember that this would still be a very significant tightening action—in other words, just pulling back on the rate of ascent a little bit. At this angle of ascent, with policy already in the restrictive territory, the federal funds rate can still be increased quite rapidly with several 50-basis-point increases, a pretty aggressive path for policy.”

Susan Collins, president of the Federal Reserve Bank of Boston, was the most enthusiastic of the three when she spoke to the Journal earlier this month.  Collins stated that the primary point he wanted to emphasize is still bringing inflation back to its target range.  “We’re going to have to tighten further and then hold for some time. I am optimistic that there is a pathway that would not require a significant slowdown. And I’m happy to talk a bit more about that, recognizing that there are some key risks and that both inflation and unemployment are very costly and that those costs are not equally distributed.”

The SVN Vanguard team knows investors need an experienced commercial property management company by their side. Contact us for commercial properties for sale.

San Diego Retail Property for lease
SVN Vanguard
San Diego commercial rental property
Orange County commercial office
100 W Broadway
Long Beach, CA 90802
License # 01840569
Phone Number
Fax Number
San Diego commercial real estate listings
San Diego commercial lease

©SVN Vanguard | LOS ANGELES| All SVN® Offices Independently Owned and Operated