Eleven more members of Congress are calling for the Federal Reserve to think twice before raising interest rates during this week's Federal Open Market Committee meeting.
A group of four senators and seven representatives, led by Sen. Elizabeth Warren, D-Mass., and Rep. Madeleine Dean, D-Pa., submitted a letter to the Fed on Monday. In it, they decried the "alarming pace" the central bank has taken with its monetary adjustments thus far this year and the Fed's "disturbing warning to American families that they should expect 'pain' over the coming months."
The contents of the letter were originally reported by Politico and confirmed by American Banker.
The letter was sent a day before the Fed convened its second-to-last FOMC meeting of the year. It is broadly expected to raise its benchmark by 75 basis points for the fourth time in four meetings.
Overall, the Fed has increased its federal funds rate by 3 percentage points this year. The committee's most recent summary of economic projections forecasted an additional 1.25 percentage points of increase by the end of the year.
The members of Congress urged the Fed to listen to the growing group of
Should the unemployment rate rise from 3.7% to 4.4% by next year, as the Fed has projected, that would equate to 1.2 million lost jobs, the letter notes. Private estimates, such as the 5.6% jobless rate forecast by Bank of America, foresee even greater losses. These projections, coupled with the Fed's commitment to continue "aggressively" pursue price stability, even if it leads to a recession, raise concerns, the lawmakers wrote.
"These statements reflect an apparent disregard for the livelihoods of millions of working Americans, and we are deeply concerned that your interest rate hikes risk slowing the economy to a crawl while failing to slow rising prices that continue to harm families," they wrote.
The letter was co-signed by Sens. Bernie Sanders, I-Vt., Sheldon Whitehouse, D-R.I., Jeffrey Merkley, D-Mass., and Reps. Katie Porter, D-Calif., Rashida Tlaib, D-Mich., Jesús García, D-Ill., Sylvia Garcia, D-Texas, and Jamaal Bowman, D-N.Y. It is the latest missive from Congress urging the Fed not to sacrifice jobs in pursuit of reining in 40-year-high inflation.
Last week, Sen. Sherrod Brown, D-Ohio,
This week's letter included a host of questions for the Fed, including its projections for job losses broken down by wage quartile, race, sex, educational obtainment and employment sector. It also asks if the Fed has put its full employment mandate aside to focus solely on price stability, and whether or not it has embedded expectations of a recession among market participants and consumers.
A Fed spokesman said the institution planned to issue a response to the letter.
