Fed Atlanta Fed Pres. Bostic: Fed’s high priority is to get inflation back to 2%

Fed’s Bostic Comments:

• “I am not in a hurry” to cut rates; want to ensure policy easing is “unambiguous.”
• Would rather wait longer for a rate cut to ensure inflation does not start to bounce around.
• Fed has to be cautious about the first rate move; it may need to be later to avoid stoking “pent-up exuberance” for investment and other spending.
• Though businesses are confident about the economy, they don’t feel they have the same pricing power as even six months ago.
• Upcoming framework review will be “robust” given the number of open questions about the economy and policy.
• No longer hearing about difficulties in supply chains; hope is that goods deflation continues.
• Expecting inflation to decline but “relatively slowly”; would not expect a rate cut before the fourth quarter.
• Fed’s highest priority is to get inflation back to 2%.
• Efficacy of monetary policy may be weaker than in the past, but it is still having an impact.
• Policy is impacting rate-sensitive sectors and delaying investment.
• Businesses are confident in the underlying strength of the economy; the next year or two should see continued solid performance.

This article was written by Greg Michalowski at www.forexlive.com.