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Fed's Bostic favors 1 rate hike in 2019

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Fed's Bostic favors 1 rate hike in 2019

The Federal Reserve should opt for only one interest rate hike this year as the economic outlook has gotten more uncertain, Federal Reserve Bank of Atlanta President Raphael Bostic said Jan. 7, according to The Wall Street Journal.

Bostic, who had previously backed raising rates twice in 2019, said the Fed should "make sure that we don't move too aggressively and then contract the economy," the WSJ reported.

Fed officials have penciled in two rate hikes for the year, downgrading their earlier outlook of three increases. But investors have grown doubtful that the Fed will continue tightening monetary policy, given the increased market volatility, trade uncertainty and decelerating global growth.

While the U.S. economy is still in "pretty good" condition, those factors could dent the outlook further, Bostic said. But he also mentioned the possibility that economic uncertainties could resolve themselves and prompt him to support two rate hikes this year.

Bostic voted for all four of the Fed's rate increases in 2018, but he has rotated out of a voting spot on the Federal Open Market Committee.

Fed Chairman Jerome Powell said Jan. 4 that the Fed "will be patient" on tightening monetary policy and that the U.S. central bank is "listening carefully" to markets' concerns over growth.