The Governor of the Federal Reserve of Michelle Bowman gives its first public remarks as a federal policy creator at the American Banican Bankers Association conference at San Diego, California on February 11, 2019.
Ann Saphir | Reuters
The Governor of the Federal Reserve Michelle Bowman said on Monday that, although the monetary policy “is now in a good place”, she wants to see how data reflects more inflation before reducing interest rates.
“I would like to gain a greater conviction that progress in lowering inflation will continue while considering further adaptation of the target range,” Bowman said in a speech at the American Bankers Association.
The growing inflation price of fundamental goods since last spring has slowed progress, Bowman said. Although she expects the inflation to continue to slow down this year, she said that disinflation “can take longer than we would hope for.”
“I still see higher risks according to the stability of prices, especially while the labor market remains strong,” Bowman said.
Latest Consumer prices index It was shown that inflation in January is higher than expected, increased by 0.5% compared to the month compared to the estimation of DOW Jones, which requires an increase of 0.3%. This has increased the annual inflation rate to 3%, and the above consensus forecasts are above 2.9%
The Fed held its target rate range from 4.25% to 4.5% at its meeting of politics in January.
Bowman said that on Monday that the current level was suitable for “enabling the committee to be patient and paid attention to inflation information how to develop.”
“The current attitude of politics also provides the possibility of reviewing further indicators of economic activity and further clarity in administration policies and their effects on the economy,” Bowman continued.
President Donald Trump’s tariffs against the greatest shopping partners in the United States have expressed concern among the economists of higher prices. Expectations for further decrease in interest rates in 2025 were weakened by Trump’s trade war. Traders currently appreciate only in one quarter a decrease in the rate this year, they state CME group data.
