Fed Official: ‘We Need to Be Cautious’ on Raising Rates After Bank Failures

Potential fault lines surfaced on Tuesday over whether the Federal Reserve should proceed with interest rate increases next month as it studies the fallout from banking-sector stresses triggered by the collapse of two midsize banks last month.

Chicago Fed President Austan Goolsbee said the central bank should proceed cautiously with any additional rate rises as it assesses after-effects of the bank failures during a speech Tuesday. “At moments like this of financial stress, the right monetary approach calls for prudence and patience,” he said in a speech at the Economic Club of Chicago.