Fed's Bostic from his monthly “Economy Matters” podcast says:
- Inflation is expected to decrease gradually and approach the 2% target, but progress may be uneven.
- Inflation trends may show periods of stagnation or more aggressive movement, reflecting variability in the data.
- A cautious policy stance will be required to avoid overreaction to short-term fluctuations.
- Ensuring that policy is aligned with reliable indicators, even amid volatility, is a key objective.
- A mistake would be to keep rates higher for longer to ensure inflation reaches the 2% target.
- The reduction of policy rates may be slower or longer to ensure steady progress towards inflation targets.
- Rates are likely to remain higher than initially expected to meet the inflation target.
Comments are consistent with others from the President of the Atlanta Fed.
This article was written by Greg Michalowski at www.forexlive.com.
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