Fed Official Backs Rate Hikes After Strong Payroll Data
Mary Daly says monetary policy may need further tightening to curb persistent inflation in the United States.
San Francisco Federal Reserve President Mary Daly stated on Friday that the central bank may raise interest rates to control inflation. She emphasized that current monetary policy does not yet provide the level of restriction needed to reach the official price target.
The United States labor market added 165,000 jobs in October, surpassing expectations of 59,000. The unemployment rate fell to 4.1%. This economic strength boosted bets on a new 0.25 percentage point rate hike in December, with the probability reaching approximately 80%.
A stronger dollar and rising yields on U.S. government bonds pressured the price of gold, which ended the day down 0.94%. The precious metal lost appeal because it does not offer yields in an environment of higher interest rates.
Regarding the technology sector, Daly noted that price adjustments related to advances in high-end computing systems have occurred in an orderly fashion. The market remains focused on the ability of these innovations to deliver concrete financial results in the short term.
Uncertainty regarding the pace of the committee's next moves remains high. The final decision will depend on discussions among Fed members in upcoming meetings.
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