White House Adviser Phelan Warns Fed Rate Hike Today Would Be a Mistake

Christopher Phelan, chairman of the Council of Economic Advisers (CEA), said a Fed rate hike would be a mistake. The Federal Reserve is set to announce its rate decision today.

Phelan made the comments on CNBC’s Closing Bell Overtime, citing recent inflation data as the reason a hike is unnecessary. The Federal Open Market Committee (FOMC), the Fed’s rate-setting body, meets this week.

Inflation Data Undercuts the Case for a Hike Phelan argued inflation has trended lower over the past three months. He pointed to every major gauge, including the Consumer Price Index (CPI) and the Personal Consumption Expenditures (PCE) index.

He noted the Fed held off on raising rates months ago when inflation ran hotter. That makes a hike now harder to justify, he said. The debate comes as President Donald Trump has pushed the Fed to lower interest rates.