US September rate rise 'less compelling'
Federal Reserve official, William Dudley, has said that a rate rise in September now "seems less compelling" than it was a few weeks ago.
New York Fed president Mr Dudley said economic turmoil in China had made the case for a rate rise harder to make. "The slowdown in China could lead... to a slower global growth rate and less demand for the US economy," he said. The US central bank was also "a long way from" engaging in more quantitative easing to prop up the economy, he said. 'Additional information' Before the recent China turmoil many economists expected rates to be raised at the Fed meeting on 16-17 September. And only last week minutes from the minutes of the Fed's meeting on 28-29 July showed that policymakers thought then that conditions for a US rate rise "were approaching". But the turmoil in China's stock markets and the, so-far, limited impact of Beijing's efforts to calm the situation has increased fears of a greater-than-expected slowdown in the world's second largest economy. That in turn could drag down growth globally, and there have been calls from some economists for the US to now put back any interest rate rises. However, despite his misgivings Mr Dudley has left the door partly open to the possibility of a rate hike in September. He said the case for a rise "could become more compelling by the time of the meeting as we get additional information on how the US economy is performing and... international financial market developments, all of which are important to shaping the US economic outlook". US interest rates have been held at near-zero since the 2008 financial crisis. Should there be a rise, it would be the first interest rate increase in nine years,