Federal Reserve officials, led by Jerome Powell, emphasized the importance of thorough deliberation and data analysis before considering a reduction in interest rates, a move anticipated by financial markets around June.
Powell, addressing the Stanford Graduate School of Business, noted that recent data on job growth and inflation exceeded expectations. He reiterated the Fed's cautious approach, indicating that any rate cut would only occur when there's greater confidence in achieving sustained inflation at the target of 2%.
Atlanta Fed President Raphael Bostic suggested that a rate reduction might be more suitable towards the end of the year, projecting a single quarter-point cut for 2024, differing from the expectations of many colleagues.
Adriana Kugler, a Fed Governor, concurred with the assessment that inflation progress has been erratic but expects a downward trend to pave the way for rate cuts this year, without specifying timing or extent.
Powell's remarks maintained the Fed's stance, indicating a possibility of rate cuts "later this year" while emphasizing the need for data to guide decisions.
The Fed's preferred inflation measure remains above the 2% target, with recent progress being limited, prompting cautious evaluation before any policy adjustments.
Paraphrasing text from "Investing" all rights reserved by the original author.
