4 Fed rate hikes this year would be ‘gradual’: Dudley


Four interest-rate rises by the Federal Reserve this year would constitute a “gradual” tightening, New York Fed President William Dudley said on Thursday, offering his definition of what has become a policy mantra from U.S. central bankers.

“If you were to go to four, 25-basis-point rate hikes I think it would still be gradual,” the influential official said at a Sao Paulo conference, noting that would be half as aggressive a policy tightening as the Fed conducted last decade.

Fed forecasts from December point to three expected hikes this year, though recent fiscal stimulus and signs of inflation have convinced some investors that four is more likely. Dudley added that U.S. fiscal policy is turning “quite stimulative.”

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