Fed’s Bostic: Sees a cut this year and 4 cuts in 2025

• Inflation moving in the right direction, a cut is likely in Q4
• Has pencilled in four cuts for 2025
• Wants to be ‘absolutely certain’ inflation will return to 2% before an initial cut that should be seen as the first in a series, that is the reason for patience
• Shares of goods rising 5% or more has fallen below 20%
• Inflation remains chief concern, businesses say they see no cliff ahead for the jobs market
• Can achieve 2% inflation with a job market that remains tight by historical standards
• remains confidence that shelter inflation will ‘fall back into line’
• GDP and jobs market data point to an ‘orderly deceleration’ in activity that will balance supply and demand, lower inflation

Picture Jerome Powell delivering a rate cut in Q4 and saying that it’s the start of a series. The market certainly wouldn’t dislike that Fed funds are priced at 4.12% for October 2025. That’s a tad lower than Bostic is forecasting. Note that Bostic is also in line with the median in the dot plot.

This article was written by Adam Button at www.forexlive.com.