Investing.com – The dollar fell on Friday after Richard Clarida, vice chairman of the Federal Reserve, said that interest rates were near neutral, but indicated that a December rate hike is still possible.
The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, fell 0.46% to 96.35, as of 10:17 AM ET (15:17 GMT),
Clarida told CNBC on Friday that the Fed hasn’t raised rates too far or fast but that it’s too early to know if they should increase rates too far to hold back growth.
The 2.5% to 3.5% range is considered a neutral level that doesn’t stimulate or hinder the economy, he said.
“I think certainly where the economy is today, and the Fed’s projection of where it’s going, that being at neutral would make sense,” Clarida said.
The Fed is expected to increase rates in December and comments from Fed Chairman Jerome Powell have increased expectations that the central bank will gradually increase rates in 2019.
Meanwhile, in a separate interview, Fed Bank of Dallas President Robert Kaplan said slowing growth in Europe and China could affect the U.S. economy.