Business

Strong case for 50 bp Fed cut, says former NY Fed chief Dudley

SINGAPORE (Reuters) – Former New York Federal Reserve President Bill Dudley said there was a strong case for a 50 basis point interest rate cut in the United States.

“I think there’s a strong case for 50, whether they’re going to do it or not,” he said at the Bretton Woods Committee’s annual Future of Finance Forum in Singapore.

© Reuters. FILE PHOTO: President of the Federal Reserve Bank of New York Bill Dudley speaks during the Bank of England Markets Forum 2018, at Bloomberg, in central London, Britain, May 24, 2018. Victoria Jones/Pool via REUTERS/File Photo

He said rates were currently 150-200 basis points above the so-called neutral rate for the U.S. economy, where policy is neither restrictive nor accomodative. “So the question is: ‘Why don’t you just get started?'”

Dudley had previously called for the Fed to begin cutting in July. U.S. yields fell in Asia trade on Friday while rates futures rallied in reaction to media reports that next week’s decision on whether to cut by 25 bps or 50 bps was a close call.

Related Articles

Back to top button