Fed's Bowman: Cautious on rate cuts, eyes on upside inflation risks
|Federal Reserve Governor Michelle Bowman said on Sunday that she still sees upside risks for inflation and continued strength in the labor market, highlighting the Fed may not be ready to cut rates when US central bankers next meet in September, per Bloomberg.
Key quotes
“The progress in lowering inflation during May and June is a welcome development, but inflation is still uncomfortably above the committee’s 2% goal.”
“I will remain cautious in my approach to considering adjustments to the current stance of policy.”
"Should the incoming data continue to show that inflation is moving sustainably toward our 2% goal, it will become appropriate to gradually lower the federal funds rate to prevent monetary policy from becoming overly restrictive on economic activity and employment.”
"But we need to be patient and avoid undermining continued progress on lowering inflation by overreacting to any single data point.”
"With some upside risks to inflation, I still see the need to pay close attention to the price-stability side of our mandate while watching for risks of a material weakening in the labor market.”
Market reaction
The US Dollar Index (DXY) is trading 0.08% higher on the day at 103.23, as of writing.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.