Federal Reserve Bank of Atlanta President Raphael Bostic told CNBC on Monday that the central bank may lean toward increasing interest rates as the inflation is still twice the target. “We may have to go up with rates,” Bostic stated when addressing a choice between increasing or decreasing. He explained that the central bank will not be “looking at cutting until well into 2024” in his view and that the appropriate course of action would be to “wait and see” the effects of tightening. The banker underlined that a certain risk of recession remains. “If we fall into recession, it will not be long or deep,” Bostic concluded.
Fed’s Jefferson: Core inflation process ‘discouraging’
United States Federal Reserve Board of Governors member Philip Jefferson underlined that the latest reading of the core inflation was “discouraging,” pointing to a slower-than-projected rate of decline in core goods prices.
“Supply and demand imbalances in the goods sector seem to be resolving less quickly than expected,” the policymaker said in a speech before Standford University’s Hoover Institution.
“I expect slower consumer spending growth over the remainder of the year in response to tight financial conditions, depressed consumer sentiment, greater uncertainty, and declines in overall household wealth and excess savings,” Jefferson explained, but argued that the Federal Reserve’s monetary policy is “well on track.”