Fed’s Bostic Sees No More U.S. Rate Hikes, No Recession
12:13 JST, October 11, 2023
Atlanta Federal Reserve Bank President Raphael Bostic on Tuesday said the U.S. central bank need not raise borrowing costs any further, and sees no recession ahead even as the Fed’s rate hikes so far slow the economy and bring down inflation.
“I actually don’t think we need to increase rates anymore” to get too-high inflation back down to the Fed’s 2% goal, Bostic told the American Bankers Association, to applause.
Policy is sufficiently restrictive, and “a lot” of the impact of the Fed’s rate hikes so far is clearly yet to come, he said. But there is also a lot of momentum in the economy, he added, which can “sop up” some of the effect of policy tightening and allow the economy to slow down without tipping into a recession.
The conflict between Israel and the Palestinian militant group Hamas which broke out over the weekend creates uncertainty for the United States and the global economy, Bostic said, noting that it will cause rethinking on markets and investments.
But the past several years have been full of unanticipated events including the pandemic and Russian’s invasion of Ukraine, he said, adding that has taught him to “just be ready and move into action mode” when needed.
If data comes in differently from what he expects, Bostic said “we might have to increase (the Fed policy rate), but that’s not my outlook right now, and that’s not my expectation.”
Bostic has been one of the Fed’s more dovish members, advocating for an end to interest-rate hikes since well before many of his colleagues, who as of last month mostly believed the Fed will need to increase borrowing costs by another quarter of a percentage point before the end of the year.
In recent days some Fed policymakers appear to have softened that view in light of the increase in longer-term Treasury yields that they believe may do some of the Fed’s policy tightening for it.
"News Services" POPULAR ARTICLE
-
New Rules Drive Japanese Trucking Sector to the Brink
-
South Korea’s Han Kang Wins 2024 Nobel Literature Prize
-
Acemoglu, Johnson and Robinson Win 2024 Nobel Economics Prize
-
Nikkei Closes Lower as Chip Stocks Drag, Investors Focus on Earnings (Update 1)
-
G-Shock Watchmaker Casio Delays Earnings Release Due to Ransomware Attack
JN ACCESS RANKING
- Asukayama Monorail in Tokyo: Free to Ride!
- Japan Trying to Draw Digital Nomads, Who Are Seen as Beneficial to Economy, Society
- JICA Employee Suspected of Leaking Info on ODA Project in Manila; Bidding for Railway Renovation May Have Been Impacted
- G20 Sees Soft Landing for Global Economy; Leaders Pledge to Resist Protectionism as Trump Calls for Imported Goods Flat Tariff
- Japanese Automakers Team Up on Software Development; Aim to Compete with U.S., China in SDV Market