Former Chairperson Ben Bernanke says the Federal Reserve will raise interest rates next week, but it could be the last time this round is over

Former Federal Reserve Chairperson Ben Bernanke said on Thursday,Apparently, the Federal Reserve will raise interest rates next weekBut the outlook for the future is even bleaker.

He said in a webinar hosted by Fidelity Investments that after raising interest rates by 25 basis points next week, "The September meeting is very suspensefulBernanke is also currently a senior advisor to fund management firm PIMCO. "

Bernanke added: "Between now and then, we will have a lot of reports,The rate hike in July could be the last。”Once the Federal Reserve reaches its final level, it will keep interest rates stable. Bernanke said,Talking about a rate cut this year is unrealisticUS inflation could "pop up" in the coming months, but then price pressures will fall "more permanently" until inflation falls to a range of 3% -3.5% next year

The US consumer price index rose modestly by 0.2% in June, and annual inflation fell to 3% from 4% in May. The last time inflation was so low was in March 2021.

"The underlying news is good," Mr. Bernanke said, adding that after 3 per cent the Fed "will spend time" trying to get all the way down to its target.

Since March 2022, the Federal Reserve has raised interest rates by 500 basis points, moving the base rate to the 5.00-5% range, a historically rapid pace of rate hikes.

He said that this dataThat creates a lot of uncertainty for the Fed. Fed officials don't know if interest rates are high enough to bring down inflationHe pointed out that the signal they got was,Financial marekts do not show excessive strain in credit conditions.

Mr. Bernanke said the uncertainty had been exacerbated by the "small banking crisis" triggered by the collapse of Silicon Valley banks in March, saying that while the crisis "appears to be getting better", bank lending had been slowing and credit standards had been tightening.

He said the US jobs market was still "pretty hot", wages were under pressure and the Fed wanted to see the market cool before declaring victory against inflation.

But he said,The US economy may be able to avoid a severe economic recessionHe added that the U.S. economy will continue to slowEven if there is a recession, it will be relatively mild。

Dollar index daily chart

At 13:58 on July 21, Beijing time, the US dollar index was trading at 100.76.