GO
Loading...

Economists Split On Gasoline's Impact On Possible Fed Cut

Thursday, 26 Apr 2007 | 3:36 PM ET

As oil prices swing, gasoline keeps rising -- and some analysts have predicted $4-a-gallon gas this summer. Will higher prices at the pumps affect the U.S. economy? Jan Hatzius, Goldman Sachs' chief U.S. economist, and Julia Coronado, senior U.S. economist at Barclays Capital, weighed in, on "Power Lunch."

$4 Gas?
Discussing whether high prices at the pump could tank the economy, with Jan Hatzius, Goldman Sachs chief U.S. economist; Julia Coronado, Barclays Capital sr. U.S. economist and CNBC's Bill Griffeth

Hatzius disputed the idea that gasoline prices would rise that sharply, telling CNBC's Bill Griffeth that "$4 seems a little high." The economist said gas prices were merely one factor in America's economy, maintaining that "realistically, we have below-trend growth" in the U.S. -- and predicted that the Fed will cut rates this year.

Coronado agreed that gasoline prices won't reach such heights -- but she believes "the global economic boom" driving up prices will continue stoking the U.S. economy, as well. She said America's economic growth will pick up in the second quarter. That, along with the upward pressure from factors like gasoline prices, will signal the Fed to "put the brakes on," Coronado said.

Contact

  • Showtimes

    United States
    Monday - Friday 1:00P ET
    Europe
    Monday - Friday 18:00 CET
    Asia Pacific
    Tuesday - Saturday 01:00 SIN/HK
    Australia
    Tuesday - Saturday 03:00 AEST
  • Sue Herera is a founding member of CNBC, helping to launch the network in 1989. She is co-anchor of "Power Lunch."

  • Tyler Mathisen co-anchors CNBC's "Power Lunch." Mathisen also co-anchors "Nightly Business Report produced by CNBC."

Power Pitch

Kenny Polcari