A top Federal Reserve official is warning that interest rates may not yet have reached their apex in the current tightening cycle despite pauses at its last two meetings, The Hill reported. Mary Daly, president of the Federal Reserve Bank of San Francisco, told the Financial Times in an interview published Wednesday that the central bank needs to take its time and make sure it executes its policy correctly. The Fed ought to be “thoughtful, take our time, not rush to judgment and not make declarations,” Daly said in the interview. “We have to be bold enough to say ‘We don’t know’ and bold enough to say ‘We need to take the time to do it right.’” The Fed’s latest rate projection from September puts the terminal rate for this year at 5.6 percent. With rates now at a range of 5.25 to 5.5 percent, that means another hike this year is officially expected. But following the two pauses and a precipitous decline over the past year in both headline and “core” inflation — which exempts the more temperamental categories of energy and food — many market commentators have been speculating that the Fed is now finished hiking rates.
