Fed Should Hike to 5% or Higher to Curb Inflation, Dudley Says

Former Federal Reserve Bank of New York President Bill Dudley said the U.S. central bank should stop “sugarcoating” its message on how high interest rates need to go -- and how much pain that will cause -- to get inflation under control.

“I think it’s 4 to 5 (percent) or higher,” Dudley said in an interview with Bloomberg Surveillance on Wednesday on how high the Fed should raise interest rates to cool price pressures. “I was 3 to 4 (percent) maybe six months ago. Now I’m 4 to 5 and it wouldn’t shock me if I’m 5 to 6 a few months from now,” said Dudley, who is a Bloomberg Opinion columnist and senior adviser to Bloomberg Economics.