The recent downturn in the financial markets may have some impact on the Fed's decision on whether to raise interest rates. But a top Fed official says they still need more data.
There has been widespread speculation the Federal Reserve would raise interest rates this year, maybe as soon as September. But the recent gyrations on Wall Street may be causing some second thoughts about that.
During a briefing with reporters in New York City on Wednesday, President of the Federal Reserve of New York, William Dudley, said that in light of market volatility and foreign developments, the decision about interest rates seems less compelling to him than it did several weeks ago.
But he also cautioned that events could change before the next Fed meeting in September that could change feelings about that.
"I think history has shown pretty clearly that the stock market movements have to be persistent to have those effects; that short term volatility doesn’t really have much implications in terms of how people think about what their wealth is over the medium or longer run.“
Overall, Dudley was upbeat about the state of the U-S economy. And as he had indicated during a recent stop in Rochester, Dudley again said that he feels Rochester's economy is more diverse and dynamic than ever before.
