Larry Busaca
Citadel founder Ken Griffin said Tuesday that the Federal Reserve should take its time reducing borrowing costs to avoid the possibility of having to do a 180-degree turn.
“If I were them, I don't want to cut back too quickly,” Griffin said of the Fed at the international futures industry conference in Boca Raton, Florida, cited by Bloomberg. “The worst thing they could end up doing is cutting, pausing, and then quickly changing course toward higher rates. In my opinion, that would be the most devastating course of action they could take.”
His comments came as consumer prices rose slightly more than expected in February, essentially reinforcing the central bank's caution about rate cuts, which are expected to begin in June.
In the interview, the billionaire investor warned that prices could remain elevated in the future, citing major inflationary forces such as government spending and deglobalization. Bloomberg reported.
The rate-setting Federal Open Market Committee will meet in a week to decide whether it wants to keep rates higher longer. Federal Reserve Chair Jerome Powell suggested last week that the FOMC is “not far off” from being ready to lower rates.
