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Bostic of the Atlanta Federal Reserve says he doesn’t see interest rate cuts this year


Key findings

  • Atlanta Federal Reserve President Rafael Bostick said he doesn’t see interest rate cuts this year, even in a recession.
  • Chicago Fed President Austin Goolsby said the Fed should reduce inflation without triggering a recession.
  • Minneapolis Federal Reserve President Neil Kashkari warned against being “fooled” by the latest inflation data.

Atlanta Federal Reserve Bank President Raphael Bostick said inflation remains too high and he doesn’t expect the Fed to cut interest rates this year, even if there is a recession.

Bostic told CNBC on Monday that policymakers won’t think about cutting interest rates “until well into 2024” and indicated that he thinks a rate hike would be more likely at that point.

However, Bostick explained that the appropriate policy now is to wait to see how the Fed’s previous moves, which have raised rates 10 times since March 2022, will affect the economy.

Chicago Federal Reserve President Austin Goolsby, also on CNBC, said the full impact of the Fed’s actions was not yet being felt and that it was important to get inflation back “on track” without causing a recession. He noted that he is taking a more cautious approach to policymaking in a period of high uncertainty. Goolsbee indicated he would monitor credit stress, debt ceiling talks, the labor market and prices ahead of the Fed’s next meeting in June.

Minneapolis Federal Reserve President Neil Kashkari said at an event in St. Paul that although consumer prices eased in April, “we should not be fooled by several months of positive data.” He added that “we have to get the job done” to reduce inflation.

Markets were pricing in a more than 75 percent chance the Fed would not raise interest rates at its next meeting in June, according to funds futures data compiled by CME Group.

CME Group

Joanna Swanson

Joanna Swanson is Europe correspondent at the Thomson Reuters Foundation based in Brussels covering politics, culture, business, climate change, society, economies and inclusive tech. With specific focus in breaking news, she has covered some of the world's most significant stories.