Gold Finance reported that on June 18, Goldman Sachs Group Deputy Chairman and former Dallas Federal Reserve President Kaplan said that if inflation remains persistently high, the Federal Reserve may need to raise interest rates as early as September. Kaplan said, “If inflation data does not cool down between now and September, it would be wise for the Federal Reserve to take action in September or in the fall. That would be the more prudent approach.”

After Federal Reserve Chair Waller hinted that he remains focused on combating inflation, the market shifted to a hawkish stance. Traders sold short-term government bonds, pushing up some yields. Waller’s remarks were reinforced by individual forecasts from Federal Reserve members, half of whom expect rate hikes before the end of the year.

Kaplan said that if inflation remains stubborn, it indicates that monetary policy is still too accommodative. He also noted, “The Federal Reserve’s policy actions are rarely a one-off. Rate hikes often come in a series of two or three. So I think if you take action in September, you need to be prepared. There may be one or two more.” (Dongxin News)