Mr. Bostic said the Fed was expected to cut interest rates twice this year. A lot could happen in the future that could lead to more or less rate cuts. The base rate is currently in a moderate tightening state, compared with the neutral rate of 3% -3.5%. The slowdown is a major concern because of the upcoming policy changes, but businesses expect 2025 to be a solid year, and so far the economy has shown resilience.
The Federal Reserve's Bostic said confidence in the economic outlook for 2025 has decreased. It is difficult to take into account all potential policy changes in the economic outlook; inflation progress is not expected to show a straight line. The Federal Reserve did not cut interest rates significantly last year, and policy remains binding; satisfied with pausing interest rate cuts to observe economic development. The Federal Reserve is approaching the threshold level of its balance sheet, and ...
We will need to see how the new administration's tariffs or other policies affect the economy; monetary policy will adjust accordingly as economic conditions change, said Mr. Bostic. The pace and magnitude of rate cuts in 2025 have not yet been decided.
I (dot plot) expect to cut rates by another 25 basis points this year, on top of the 50 basis points cut in September.
Mr. Bostic said the labour market had slowed but did not appear weak or weak; the economy was close to the Fed's target and "edging closer"; inflation remained well above 2 per cent; the risk that the economy was too strong could hinder policy readjustment; and there remained a strong focus on the inflation target but also on labour market conditions.
The Fed's Bostic said the latest "dot plot" showed a "considerable" divergence of opinion within the central bank, with the central bank in no hurry to achieve a neutral interest rate, preferring not to rush to judgment or assume that the inflation problem has been resolved, and the range of views on the future path and the discussion of a neutral rate was "robust". (Jin X)
The Federal Reserve's Bostic said that there is still some way to go on inflation; employment remains quite strong by historical standards; the Fed cannot wait for inflation to reach 2% before abandoning its restrictive stance; and it is still waiting for data to determine when to cut interest rates.
The Federal Reserve's Bostic said that the U.S. economy is expected to normalize in the coming months; interest rate cuts are coming, and we hope to see more data; recent inflation data has strengthened confidence that inflation will return to 2%; if the economy develops as expected, we will cut interest rates before the end of the year; we are at an inflection point where inflation is close to our target; we do not want the labor market to turn from hot to cold; and a recession is not within hi...