Fed's Musalem Backs Further Policy Firming Over Six to Nine Months

St. Louis Fed President Alberto Musalem stated that further monetary policy firming will likely be required over the next six to nine months to return inflation sustainably to the 2% target within an 18-month timeframe. Speaking in New York, Musalem argued that recent spikes in long-term Treasury yields have not sufficiently tightened financial conditions to replace additional interest rate increases. He maintained an open mind heading into the October 27–28 FOMC meeting, describing broader financial conditions as still accommodative and noting the labor market remains balanced and stable.