"Through lack of analysis, regulation, oversight and foresight - central bankers have shown this last week they were prepared to use high rates to risk and even precipitate bank failures and global financial instability," she wrote.
This is even though economies have not fully recovered from the Global Financial Crisis and the pandemic, she added.She even said that civil servants that head up central banks seem willing to sacrifice private banks and global financial stability in their rush to raise rates, crush demand, discipline workers and shrink the nation's income. even called on workers to hold off on asking for big pay raises because that will make inflation worse.
Higher interest rates make borrowing for anything from mortgages to credit cards more expensive. And it encourages people to save rather than spend, which in theory, helps bring down prices. But it and the risk is that the central bank raises rates to the point where the economy slows down and even tilts into recession, as demand contracts. "If workers demand higher wages to deal with the inflationary impact of higher energy and other commodity prices — that is a consequence, not a cause of commodity price inflation — that regulators and central bankers refuse to manage or regulate," she wrote.
Markets are closely watching the Fed's two-day meeting that ends Wednesday for their interest rates decision. The US central bank already hiked interest rates eight times over the past year to its targeted levels ofSubscribe to push notifications
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