MW Fed's Collins supports holding interest rates steady for 'longer time'

By Greg Robb

The U.S. economic outlook is cloudy and the Federal Reserve should be patient about adjusting interest rates, Boston Fed President Susan Collins said Thursday.

"I strongly believed at the meeting that we had last week that holding our rate steady was an appropriate policy stance and, looking forward, I would expect holding it steady for a longer time is likely to be appropriate," Collins said, in a moderated discussion sponsored by the Insurance Women's Investment Network.

Collins said the outlook for the economy is much cloudier in recent weeks than it was last year.

She said it looks inevitable the White House tariffs are going to increase inflation in the near term. That increase could be short-lived but there were questions about when prices increases would then start to soften.

At the same time, there could be slower growth stemming from a "wait-and-see" stance adopted by businesses.

The Boston Fed President, who is a voting member of the Fed's interest-rate committee this year, said it was important to remember that economic growth was solid at the start of the year.

She said it was too soon to read too much into surveys showing weaker consumer and business confidence.

The underlying strengths of the economy are "still very much here," she said. It was important to remind people about this because too much focus on recent weak data could start a self-fulfilling downward trend, she noted.

-Greg Robb

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March 27, 2025 17:58 ET (21:58 GMT)

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