Fed Whisperer: December Rate Hike All but Certain, Focus Shifts to Size and Pace

Odaily: Nick Timiraos writes that after a third consecutive stronger-than-expected inflation report, a December rate hike by the Federal Reserve is all but certain, with market focus shifting to the size of the move and the subsequent pace—whether it will be a 25 basis point increase per meeting, a one-time 50 basis point hike, or a signal of multiple consecutive 25 basis point increases.

Nick Timiraos notes that the Fed will hold its policy meeting on December 8-9, and the bigger question is whether this hike is the moderate adjustment of two to three more increases envisioned by several officials, or the beginning of a sustained campaign to restrain the economy and bring down inflation.

Previously, Fed Governor Waller, who supported keeping rates unchanged last week, said that if the October core price increase on a month-over-month basis reached about 0.3%, the Fed should consider a 50 basis point hike in December—and the latest data released happened to match that scenario. Dallas Fed President Logan also hinted after the data release that given current inflationary pressures, it may be necessary to accelerate the pace of rate hikes. Such tactical choices are typically decided by the Fed Chair. (Wall Street Journal)