St. Louis Fed President Alberto Musalem said the Treasury selloff reinforces the need for the Federal Reserve to strengthen its inflation-fighting credibility through earlier rate increases.

Musalem told the Financial Times that the Treasury selloff signaled a need for the Fed to build inflation-fighting credibility through interest-rate increases.
The Fed held rates unchanged at its latest meeting, while three of 12 FOMC members dissented in favor of a quarter-percentage-point increase.
Thirty-year Treasury yields rose above 5.2%, a 19-year high, after the policy decision and comments from Fed chief Kevin Warsh about potentially changing inflation goal posts.
CME Group FedWatch showed traders pricing a 67% chance of a 25-basis-point Fed rate hike in September.

Quotes

“expressed a preference”— Alberto Musalem