world-economy

Currency Volatility Threatens to Push US Rates Higher, Bessent Warns

Treasury Secretary Scott Bessent cautioned that disorderly movements in the Japanese yen could transmit inflationary pressures into the US financial system, potentially forcing the Federal Reserve to raise interest rates. His comments followed the administration's intervention to stabilize the currency last month. European inflation has accelerated to its fastest pace since 2023, prompting policymakers to signal rate increases. ECB Governing Council member Primoz Dolenc said September presents a reasonable opportunity to hike rates, with additional clarity expected from December inflation data.