Larry Summers

The Federal Reserve's policy rate will peak at about 5.5% or a little above in the 2022-2023 hiking cycle.

“My best guess would probably be 5.5% or a little above 5.5%. But 6% would not surprise me greatly.”

Said on

6 March 2023 · CNN interview, reported by Benzinga

Source

Larry Summers Sees Rates Topping Market Expectations: 'My Best Guess Would Probably Be...' · Benzinga

Should come true

2023

How sure they sounded

my best guess would probably be

Categories

MarketsEconomy

Importance

3 of 5 · The peak Fed rate set US borrowing costs and moved global markets.

Outcome

Accurate Happened 26 July 2023.

The Fed's last hike of the cycle, on July 26, 2023, took the target range to 5.25-5.5%, and it held there until September 2024. The peak upper bound matched his 5.5% best guess, and the 6% he called possible never came.

Evidence:

• https://www.federalreserve.gov/newsevents/pressreleases/monetary20230726a.htm
• https://www.federalreserve.gov/newsevents/pressreleases/monetary20240918a.htm