A senior Democratic lawmaker has warned the Federal Reserve against raising interest rates too soon, highlighting the risk of a political backlash as the US central bank begins to ponder the withdrawal of monetary support.
The comments from Carolyn Maloney, representative from New York and a senior member of the House financial services committee, came in response to last week’s economic projections from Fed officials, which pointed to a two-notch interest rate rise in 2023, earlier than forecast just three months ago.
“The Fed should be very cautious about pumping the brakes on the economy,” Maloney told the Financial Times. “The main point I want to make is that we’re coming out of an economic depression. So the last thing we need is for the Fed to tighten monetary policy too quickly and send us right back into a recession.”
Maloney’s comments came ahead of congressional testimony on Tuesday afternoon by Jay Powell, the Fed’s chair, before the…