The Federal Reserve has hiked interest rates eight times since 2015 and former Microsoft COO Bob Herbold says maybe it’s time for the central bank reduce its pace.
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“The Fed ought to think about slowing down. We need to stabilize a bit. You see a lot criticism on the speed,” he told FOX Business’ Neil Cavuto on Monday.
At the November meeting, Fed officials indicated they will maintain plans to keep raising interest rates as the U.S. economy improves and with the U.S. unemployment rate at the lowest level since 1969. Officials expect to hike rates by the end of this year and gradually continue to raise rates at least through 2019.
Herbold said Fed Chairman Jerome Powell is adding risk to the financial markets and the U.S. economic recovery by over doing it.
“I think that there’s no reason why you can’t’ let your foot off that accelerator for a bit and let things stabilize,” he said.
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Last month, President Trump blamed the central bank for driving the selloff in the stock market, saying the Fed “has gone crazy.”
“I think the Fed is making a mistake. They’re so tight. I think the Fed has gone crazy,” Trump told reporters.
The central bank’s benchmark federal funds rate influences interest rates across the economy, including the prime rate, which is used by banks to set rates for credit cards and other methods of borrowing.
Additionally mortgage rates are rising hitting a 7-year high making home loans more expensive.
