Fed Hawkish Camp Expands: Five Regional Fed Presidents Publicly Support Rate Hike After July Meeting

August 5th. The hawkish voices within the Federal Reserve continue to strengthen. Out of the 12 regional Fed presidents, 5 have publicly expressed a leaning towards rate hikes after the July meeting, believing that the current monetary policy stance is not restrictive enough and that inflation risks have not completely subsided.

Among them, Cleveland Fed President Harker stated that she leaned towards a rate hike at the recent meeting because the current policy stance is "not restrictive enough"; Dallas Fed President Kaplan pointed out that even excluding recent shocks, core inflation remains close to 2.5%, supporting the adoption of a more tightening policy.

Minneapolis Fed President Kashkari stated that to prevent high inflation from further solidifying, policy should be gradually tightened while obtaining more inflation and employment data, believing that "small continuous actions" are preferable to being forced to take larger measures in the future.

Kansas City Fed President George said that considering the strong U.S. demand and investment, the current monetary policy has not reached a sufficiently restrictive level, and achieving the 2% inflation target requires a more tightening policy.

St. Louis Fed President Bullard also supports a rate hike and warns that the recent sell-off in the U.S. Treasury market reflects market concerns about the Fed's credibility, with ongoing supply shocks pushing the broader price pressures felt by businesses and households.

Out of the 12 regional Fed presidents, 5 have explicitly signaled a leaning towards rate hikes. Meanwhile, 7 Fed governors, New York Fed President Williams, and Philadelphia Fed President Harker had previously supported keeping rates unchanged, indicating significant internal Fed disagreements over the future policy path.