Fed may have to speed up rate rises, Australian governor warns

philip-lowe

The Federal Reserve may have to raise interest rates quicker than expected to deal with the recent budget deal, Australia’s central bank governor said.

“The US economy is experiencing a sizeable fiscal stimulus at a time of limited spare capacity,” Philip Lowe told Australian lawmakers on August 17. The Reserve Bank of Australia governor said this could result in a “larger-than-expected pick-up in inflation in the United States”.

The Congressional Budget Office estimates that the budget agreed

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