The persistent discord between the Fed's policy signals and investors' interest-rate expectations is unusual and unsettling, Mohamed El-Erian said. It could lead to a surge in market volatility or end up eroding the central bank's credibility, the top economist said on Twitter. AdvertisementThe ongoing discord between the Federal Reserve's policy signals and financial-market expectations is unusual, and could end up sparking a bout of market volatility or eroding the central bank's credibility, according to top economist Mohamed El-Erian. The Fed has been persistent in its war against inflation, and raised interest rates for the 10th time in a row this month. "It is also unsettling as its resolution will involve either a bout of market volatility or further erosion of Fed credibility," he added.

Source: Economic Times May 19, 2023 00:25 UTC