Federal Reserve Governor Michelle Bowman said Monday that she was open to lifting interest rates by more than the traditional quarter-point at the central bank’s next meeting in March.
Bowman’s comments came after several officials on Friday pushed back against the idea of a half-point increase in the Fed’s benchmark short-term interest rate. The Fed is looking to raise rates as inflation surged to 7.5% in January compared with a year earlier, the biggest increase in four decades.
James Bullard, president of the Federal Reserve Bank of St. Louis, has expressed support for a half-point hike sometime at the Fed’s next three meetings. The Fed is almost certain to start lifting interest rates at its March 15-16 meeting, with most officials who have expressed views supporting a quarter-point increase.
Bowman said in prepared remarks to an American Bankers Association Conference in Palm Desert, California, that she supported lifting rates next month and that “if the economy evolves as I expect, additional rate increases will be appropriate in the coming months.”
“I will be watching the data closely to judge the appropriate size of an increase at the March meeting,” she added, suggesting she is open to a half-point hike.
Any increase next month would be the first since 2018.
Several key economic reports will be released before the Fed’s next meeting, including a monthly jobs report, a consumer price report and other inflation measures, and data on consumer spending.
Before joining the Fed’s board in 2018, Bowman was the top bank regulator in Kansas and has not been a leading voice on the Fed’s interest rate policies. Still, as a Fed governor she has a permanent vote on interest rates and three of the Fed’s seven governor seats are now vacant.