Fed should get interest rates above 5% and sit there, Harker says

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Fed should get interest rates above 5% and sit there, Harker says
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Philadelphia Fed President Patrick Harker on Tuesday said the Fed should raise interest rates above 5% and then pause.

Philadelphia Fed President Patrick Harker on Tuesday suggested he might support one more quarter-percentage-point interest-rate hike before pausing.

Since last March, the Fed has increased its benchmark rate from close to zero to a range of 4.75%-5%. Interest-rate policy works with a lag, and this cooling will happen at a different pace for different sectors, he added. Earlier Tuesday, Chicago Fed President Austan Goolsbee said “prudence and patience” was the right policy approach in the wake of the turmoil in the financial sector.

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