Fed officials say Sept rate rise less likely

Two senior Federal Reserve officials recently said a September rise in US official rates was less likely. William Dudley, is seen as “dovish” but more importantly he is regarded as being close to Yellen on views on monetary policy and is a voting member of the FOMC. In an unscheduled interview, he said a September rise was “less compelling” in light of international developments which include global financial markets gyrations, the slowing Chinese economy and falling commodity prices. “From my perspective, at this moment, the decision to begin the normalisation process at the September FOMC meeting seems less compelling to me than it was a few weeks ago.” He added he hoped the US could raise rates this year but added the move would be data dependent in what has become a Federal Reserve mantra in recent months. He noted US data has been positive, citing improved August consumer confidence figures and good July new home sales. In another sign the Fed may delay the expected September rate rise, Kansas City Fed chief Esther George said the Fed should take a “wait and see” approach on hiking rates, although as non-voting member of the FOMC her view is perhaps less influential than Dudley’s.