John Cochrane, a professor of economics at Stanford University said the Fed should increase rates above 9% to tame inflation.
Two days later, the Bureau of Economic Analysis released the closely watchedotherwise known as PCE. The PCE index saw the largest 12-month jump rising 6.8% in June, an increase that hasn’t been recorded since January 1982.
“That means, right now with 9 percent inflation, economists are talking about 10, 11, or 12 percent interest rates to bring [prices] down,” Cochrane remarked. “I think the Fed and markets are counting on a lot of inflation going away on its own without interest rates having to go quite that high,” the Stanford economist told Kitco News anchor David Lin.
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