Federal Reserve officials have recently expressed caution about the possibility of lowering interest rates, stressing the need to closely monitor inflation. Federal Reserve Governor Michelle Bowman, speaking at the Shadow Open Market Committee in New York on Friday, noted that although inflation is falling, it has not yet reached a level that would justify an interest rate cut.
Bowman highlighted that there remain many upside risks to inflation, and did not rule out the possibility of further interest rate increases if inflation does not continue to decline.
That sentiment was echoed by Dallas Fed President Lori Logan, who said in a prepared speech at Duke University that it was too early to consider cutting interest rates. Logan stressed the need for more clarity on the economic path before considering cutting interest rates, expressing concern that inflation may stabilize at current levels rather than continue to decline.
These statements from Bowman and Logan are in line with the broader view among Federal Reserve officials, including Fed Chairman Jerome Powell, who have called for patience in adjusting interest rates. This view is supported by recent strong labor market data, which showed a significant increase of 303,000 jobs in March and the unemployment rate fell to 3.8%, further strengthening the economy.
Investors have adjusted their expectations accordingly, with little expectation of a rate cut at the next FOMC meeting in May. Opinions are divided on the possibility of an interest rate cut in June.
At the previous FOMC meeting, officials expected three rate cuts this year, albeit with less certainty than before. Strong employment numbers have reduced the immediate need for interest rate cuts, according to economists.
The next CPI report, scheduled to be released next Wednesday, is highly anticipated because it may indicate whether the inflationary pressures we saw at the beginning of the year are beginning to ease.
Reuters contributed to this article.
This article was written and translated with the help of artificial intelligence and reviewed by an editor. For more information, see the terms and conditions.
2024-04-06 23:37:00
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