Discussion
In an interview with CNBC this morning, Roger Ferguson confirmed at least three more hikes are on the table due to the “intractable” nature of inflation and the fact the Fed has been “very clear” about getting it down to 2%.
Ferguson is a key unofficial Fed communication channel and is to be taken seriously. He was key in my forecast that the FOMC would raise the terminal rate by 50 bps in June, and the fact he is already communicating at least another hike on top of that says the Fed is on the move (though this is not a surprise for those closely monitoring the movement of the 3y/10y UST curve). Lastly, the fact his comments were published not two hours before Powell speaks at 9:30am EST was no accident.