St. Louis Fed President James Bullard said today that the “current level of the policy rate is about right”. And, he added that “maintaining the current level of the policy rate would be an appropriate policy” for the near future.

He explained that a “modernized” version of the Taylor rule recommends a “relatively subdued policy rate path” closer to St. Louis Fed’s recommendation. On the other hand, the “unmodernized” Taylor rule calls for “rapid increase in the policy rate”. Though, he also acknowledged that Fed’s September medium projection is “between the modernized and unmodernized” versions.

Press release and Bullard’s presentation.

Cleveland Fed President Loretta Mester told CNBC “the thought about raising interest rates is not a near-term consideration at all.” Instead, “we’re going to think about the decision coming up, which is about the asset purchases, and then as those wind down we’ll have time to assess where the economy is.”

“I don’t think that interest rate hikes are coming any time soon because I don’t think we’ll reach our goals which are maximum employment and inflation at and above 2% for some time,” Mester said.

“So far the medium-run inflation expectations and longer-run inflation expectations are still at levels consistent with our 2% inflation goal,” she said. “We don’t want to get into a situation where they continue to move up because that would be a signal that we may have to do an adjustment.”

Atlanta Fed President Raphael Bostic told Bloomberg News yesterday, last week’s strong non-farm payroll report will probably mean we have to do a little more work… And I would expect that that would translate into us raising interest rates more than I have projected right now.”

Bostic previously indicated that he expects interest rate to peak at 5.00-5.25% to get policy sufficiently restrictive. Rate would then stay there throughout 2024. To him, a hike peak could come through an additional quarter-point hike after the two currently envisaged, without ruling out a half-point hike.

He expects inflation to be in the “low 3s” this year, still well above Fed’s 2% target. “Those last few tenths of a point can take a long time to be realized,” he said. “And so I want to make sure that we are in the right place before we start easing off our policy because the most important thing at this stage is to get our price stability measure as close to target as possible.”