Fed Presidents Thomas Barkin of Richmond and Raphael Bostic of Atlanta shared their perspectives during an event hosted by the Richmond Fed.

Barkin didn’t provide any conclusive hints about the June meeting, stating, “I’m not going to prejudge June. I’d like to be convinced of that and I’m still looking to be convinced of that.”

Bostic emphasized the lag effect of the policy, adding, “Our policy works with a lag. And we’re just at the very beginning of this time when that lag is starting to play out and you’re starting to see tightness emerge. Right now, absent a big change, I think I will be comfortable saying let’s just look and see how things play out.”

Separately, San Francisco Fed President Mary Daly shared a similar sentiment of cautious observation, saying, “I really think, at this point in our tightening cycle, it is prudent to resist the temptation to say what we are going to do for the rest of the year.”

The collective view indicates an element of uncertainty and data-dependency in Fed’s next moves.

St. Louis Fed President James Bullard reiterated the need for more rate hikes to combat persistent inflationary pressures. He stated, “I think we’re going to have to grind higher with the policy rate in order to put enough downward pressure on inflation and to return inflation to target in a timely manner.”

“I’m thinking two more moves this year – exactly where those would be this year I don’t know – but I’ve often advocated sooner rather than later,” he added.

According to Bullard, Fed’s March median forecast, which suggested rates peaking at 5.1%, was predicated on a slowing U.S. economy and rapidly falling inflation. Instead, he noted, the economy has exhibited robust growth and inflation has not been abating as swiftly as hoped.

With this unexpected scenario in play, Bullard cautioned about the risks of inflation not subsiding to lower levels. Referring to the buoyant labor market, he emphasized, “As long as the labor market is so good it is a great time to get this problem behind us and not replay the 1970s.”

In an interview with CNBC, Minneapolis Fed President Neel Kashkari acknowledged the uncertainty surrounding the decision whether to raise rates further in June. He highlighted, “I think right now it’s a close call, either way, versus raising another time in June or skipping. What’s important to me is not signaling that we’re done.”

Kashkari clarified that even if the Federal Reserve opted not to hike rates in June, it wouldn’t signal the end of the current tightening cycle. Instead, it would be a strategic move to gather more information and potentially reinitiate the raise in July.

Considering his tenure on the committee, which spans “seven or eight years”, Kashkari conceded that this period marks the highest degree of uncertainty they’ve faced in terms of comprehending the underlying inflationary dynamics. Consequently, he is placing a greater emphasis on inflation to guide his decisions.

He speculated, “It may be that we need to go north of 6%, let’s see what happens in the underlying services economy.” Yet, Kashkari is mindful of the potential impact of banking stress on inflation rates.

“But if the banking stresses start to bring inflation down for us, then maybe we’re getting closer to being done. I just don’t know right now,” he added.

Minneapolis Fed President Neel Kashkari, in an interview with Wall Street Journal, suggested that Fed could afford to adopt a slower pace in its current policy trajectory, while emphasizing that this should not be construed as the end of their monetary tightening efforts.

Expressing his openness to a slower approach, Kashkari stated, “I’m open to the idea that we can move a little bit more slowly from here,”. However, he strongly disagreed with any sentiment that suggested the Fed’s task was complete. “I would object to any kind of declaration that we’re done,” he clarified.

Kashkari went on to argue that skipping a meeting to gather more data could be a sensible decision. “If the committee chooses to skip a meeting because we want to get more information, I could make the argument why that makes sense,” he explained.

He further distinguished this action from an implied cessation of the Fed’s work, saying, “A skip to get more information is very different in my mind than [saying], ‘Hey, we think we’re done.'”

Fed Chair Jerome Powell said at a conference today, “We’ve come a long way in policy tightening and the stance of policy is restrictive.”

Also, “We face uncertainty about the lagged effects of our tightening so far and about the extent of credit tightening from recent banking stresses.”

The Fed Chair suggested that the central bank now has room to scrutinize the economic data and evolving outlook more closely, and make measured assessments. “Having come this far, we can afford to look at the data and the evolving outlook to make careful assessments,” he added.

Interestingly, Powell emphasized the influence of the banking sector on the current financial landscape. He said, “While the financial stability tools helped to calm conditions in the banking sector, developments there on the other hand are contributing to tighter credit conditions and are likely to weigh on economic growth, hiring and inflation.”

“As a result, our policy rate may not need to rise as much as it would have otherwise to achieve our goals. Of course, the extent of that is highly uncertain,” Powell concluded.

Fed Governor and Vice Chair Nominee, Philip Jefferson, has given a sobering assessment of the ongoing inflationary pressures that US economy is wrestling with. In a speech, he highlighted that, while inflation has decreased significantly since last summer, the high levels persist and progress in mitigating them appears to be slowing.

Jefferson made it clear that tackling inflation remains a substantial challenge. He stated, “While inflation has come down substantially since last summer, it is still too high, and by some measures progress has been slowing.” Moreover, he underscored that “outside of energy and food, the progress on inflation remains a challenge.”

The Vice Chair Nominee then offered a more granular perspective on core inflation, distinguishing between core goods inflation, housing services inflation, and nonhousing services inflation.

Jefferson noted, “Core goods inflation fell sharply over the second half of 2022 as supply-chain bottlenecks eased, but more recently it has stabilized at around 2.6 percent.”

Housing services inflation, which includes rent and the equivalent for owner-occupied homes, was another key point of discussion. He pointed out that “Housing services inflation, which is 8.2 percent on a 12-month basis. Housing is a big part of inflation, and while rent increases on new leases have come down considerably over the past year, it will take some time for this softening in rents to show through to the 12-month changes.”

As for nonhousing services, the largest component of services, inflation remains stubbornly high at around 4.5% with no substantial decrease in sight.

Full speech of Fed Jefferson here.

Dallas Fed Lorie Logan said in speech, “after raising the target range for the federal funds rate at each of the last 10 FOMC meetings, we have made some progress.”

Logan noted, “The data in coming weeks could yet show that it is appropriate to skip a meeting. As of today, though, we aren’t there yet.”

Addressing the inflation target, Logan emphasized the challenges that remain. “We haven’t yet made the progress we need to make. And it’s a long way from here to 2% inflation,” she remarked.