US Federal Reserve may hike policy rates to 6%: BofA Global Research

The US Federal Reserve may hike interest rates to nearly 6 per cent, BofA Global Research said, as strong US consumer demand and a tight labour market would force the central bank to battle inflation for longer. 

The number is higher than a peak of 5.4 per cent by September that traders are currently pricing in. The current rate is at 4.75 per cent. 

“Aggregate demand needs to weaken significantly for inflation to return to the Fed’s target. Further supply-chain normalization and a slowdown in the labor market will help, but only to a degree,” said BofA in a noted dated February