Federal Reserve Bank of Cleveland President Beth Hammack said on Thursday that the era of ultra-low interest rates that shaped many people's perceptions of financial conditions may have been an exceptional period, and reiterated her view that the Federal Reserve needs to move to raise interest rates given that inflation remains elevated. In an interview with Bloomberg Television, Hammack said, "Looking back at history, you'll see that 2008-2020 was the exceptional period." Hammack, who has a vote on the Federal Open Market Committee this year, joined Dallas Fed President Lorie Logan and Minneapolis Fed President Neel Kashkari in advocating for a quarter-point rate hike at the July 28-29 FOMC meeting, voting against holding rates steady. The next FOMC meeting is scheduled for September 15-16.
Hammack argues for rate hikes, which would raise the effective federal funds rate.
Rate hike expectations typically push long-term yields up, lowering bond prices.
