Fed Governor Lisa Cook said in a speech that the US economy is in a “good position”. She remains “confident” that inflation is moving sustainably toward Fed’s 2% objective, while acknowledging that the path may be “occasionally bumpy.” Cook observed that employment risks are weighted to the downside but have “diminished somewhat” in recent months.
Cook reiterated that the direction for monetary policy remains “downward” but stressed that the “magnitude and timing of rate cuts will depend on incoming data, the evolving outlook, and the balance of risks.”
Highlighting the need for flexibility, she emphasized that monetary policy is not on a “preset course” and that she is prepared to respond to changing conditions.
Fed’s Collins: Additional policy easing required, final destination still uncertain
Boston Fed President Susan Collins stated in a speech that “additional policy easing is needed” as monetary policy remains “at least somewhat restrictive.”
She acknowledged that the “final destination” of policy adjustments is “uncertain”, and emphasized the importance of a “careful and deliberate” approach. FOMC should take the time to “holistically assess” data and evaluate its implications for the economic outlook and balance of risks.
Collins described the economy as being in a “good place overall,” with inflation on track to return to Fed’s 2% target, albeit unevenly. She noted that while the labor market is healthy, job growth is becoming increasingly concentrated in fewer sectors. Collins warned that “any further slowing in hiring would be undesirable”.