Federal Reserve Bank of Boston President Susan Collins said officials are taking a more patient approach to monetary policy now that rates are at or near their peak, though further rate increases are still possible.
US central bankers can take more time to evaluate incoming economic data because they “are likely close to, and possibly at, the peak of this tightening cycle,” Collins said Wednesday in remarks prepared for an event at Wellesley College in Massachusetts.
However, “further tightening could be warranted depending on incoming information,” the Boston Fed chief said.
Fed officials left their benchmark lending rate unchanged last month in a range of 5.25% to 5.5% — a 22-year high — and signaled they expect one more increase this year. Projections released at the meeting also showed policymakers expect fewer rate cuts next year than they did in June.
Collins, who does not vote in rate decisions this year, said she expects policymakers will need to “hold rates at restrictive levels for some time” and until officials see evidence that inflation is sustainably on a path to 2%.
She also said that high inflation risks were becoming more “balanced” with the risk that officials slow activity more than needed to cool inflation.
It may take longer for higher rates to hit some parts of the economy because many households and corporations built up cash piles, in part after locking in low rates early in the pandemic, according to Collins.
“These factors have likely made the economy less interest sensitive than during past tightening cycles,” she said.
Collins, who does not vote in rate decisions this year, said last month that further tightening was possible and that rates may need to stay higher for longer than previously expected for the US central bank to achieve its 2% inflation goal.
Several Fed officials have said in recent days that a surge in long-term Treasury yields may lessen the need for further rate hikes. Investors see a less than 20% chance of another quarter-point increase when policymakers next meet, according to pricing in futures markets.
Collins’s remarks did not address how the rise in Treasury yields could affect monetary policy.
LPL Financial and Raymond James also add independent advisors from Osaic and Edward Jones in Michigan and Arizona.
The SEC-registered RIA advises on more than $1 billion in client assets, with no advisory fee through 2027 and no human financial advisors.
The four wirehouse firms lost 1,449 experienced advisors and recruited 932 in the first six months of the year, according to Diamond Consultants.
Merit's 10th Commonwealth addition deepens its Western New York reach, while another Hightower partner joins its Signature Wealth platform in Michigan.
Report on Climate Action 100+ signals risk for passive managers' 13G status heading into the 2027 proxy season.
Knighthead Life entered the market with a competitive MYGA. A strong launch earned advisor confidence and paved the way for FIAs.
As AI makes financial information more accessible than ever, Lana Hock explains why human judgment, trust, and empathy remain the qualities clients value most in a financial advisor
