Fed Bowman Signals Stalling Progress on Lowering US Inflation

Michelle Bowman from the US Federal Reserve Board of Governors signalled, today, that ‘progress on US inflation seems to have stalled.’ Here are the highlights from her speech.

• Core inflation is uncomfortably above the Fed’s 2% target. The labor market is near full employment, core inflation is elevated. I am concerned if Fed cuts too much, could overheat the economy.
• I want to proceed cautiously and gradually with rate cuts. Lowering the policy rate too quickly could reignite inflation.
• We have made progress lowering inflation, cooling labor market. However labor market data has gotten harder to interpret.  Upside risks to inflation remain prominent.
• Economic conditions are very strong, while the Fed still hasn’t achieved its 2% inflation target.
• Inflation is the biggest priority when making policy choices. Doesn’t take a dissenting vote on policy lightly.

Source: xStation5

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