US Fed official warns of inflationary risk of over-consumption [Video]

A senior Federal Reserve official confirmed Thursday that the US central bank still intends to start cutting interest rates “at some point this year,” but warned against the potentially inflationary effect of over-consumption.

“If the economy evolves broadly as expected, it will likely be appropriate to begin dialing back our policy restraint later this year,” Fed vice chair Philip Jefferson told an event at the Peterson Institute of International Economics (PIIE) in Washington.

The number two man at the US central bank said he still expects growth in spending and production in the US to slow in 2024.

“Even so, without a clear understanding of why consumer spending has been so resilient, I see continuing strength in spending as an important upside risk to my forecast,” he said.

US households continued to …