The best approach for monetary policy is patience

Atlanta Federal Reserve President Raphael Bostic indicated that a robust economy provides the US central bank with the opportunity to consider the effects of tariffs on inflation and growth, while also expressing openness to the potential for a single interest rate cut later this year.

Key Quotes

• Best monetary policy approach now entails ‘patience’.
• Given the ‘healthy’ economy, the Fed has time to see how uncertainty resolves.
• ‘I am in no hurry to adjust our policy stance.’
• Still sees a possible path to one interest rate cut this year, depending on the economy.
• ‘Tough call’ to say if Fed would be cutting rates absent trade uncertainty.
• Says he is ‘very cautious’ about jumping to cutting rates.
• Says he needs to see more progress on lowering inflation before supporting a rate cut.
• Not declaring victory on inflation yet.
• Say there is still a way to go on inflation; core prices are ‘still an issue’.
• Unclear right now how tariffs will affect the inflation outlook.
• Hard data has yet to reflect the ‘gloomier’ sentiment mood.
• Job market appears broadly healthy, with some signs of weakness.
• No sign yet tariffs have boosted inflation.
• Recession is not in his forecast right now.