The Federal Reserve Open Market Committee will meet this week to determine whether to raise interest rates

Washington, D.C.—Yesterday, Senator Martin Heinrich, (D-NM), Chairman of the U.S. Congress Joint Economic Committee (JEC), sent a letter to Federal Reserve Chairman Jerome Powell ahead of the July meeting of the Federal Reserve Open Market Committee,  urging caution around additional monetary tightening in light of current economic developments.

“As Chairman of the Joint Economic Committee, I value the importance of an independent Federal Reserve. It is also within my duties to make clear that excessive policy tightening is not warranted given current and upcoming macroeconomic developments. These include the continued expiration of key policy supports for working families, the ongoing housing affordability crisis, and the effects of recent and potential fiscal crises, and they warrant caution around additional policy tightening.”

In the letter, Chairman Heinrich expresses concern that “the economy is starting to feel the sting of the combined effect of the Federal Reserve’s unprecedented string of rate hikes,” including a rising Black unemployment rate and notable recent growth in the number of people working part time for economic reasons, despite their desire to work full time. “Despite the strength of the labor market and falling inflation, I am increasingly concerned by a number of economic headwinds that threaten both the overall economy and the family finances of millions of Americans in New Mexico and across the country.”

“Given the high degree of uncertainty of the cumulative effects on the economy from the already enacted monetary tightening and its lagged ripple effects on economic activity and inflation, I reiterate my caution against additional monetary tightening,” Heinrich said.

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