The Federal Reserve’s year-long aggressive monetary tightening efforts could turn out to be one of the most significant policy errors in the last several decades, according to renowned economist Mohamed El-Erian.
El-Erian shared excerpts from the Peterson Institute for International Economics (PIIE) and the Financial Times that reinforced his view that the U.S. central bank is committing egregious policy missteps.
“As first mentioned almost a year ago, I fear that this may well end up being the biggest Fed policy mistake in several decades,” the chief economic adviser at Allianz tweeted on Monday.
The PIIE lamented on the Fed’s macroeconomic scenarios to determine the 2023 stress tests on large banks. The think tank noted that the measurements were not diverse enough and failed to address the potential effects of higher interest rates on financial institutions….