Atlanta Fed’s Bostic Says He Doesn't See Rate Cut This Year

Federal Reserve Bank of Atlanta President Raphael Bostic said inflation remains too high, and he doesn’t expect the Fed to cut interest rates this year, even if there is a recession.

Bostic told CNBC on Monday that policymakers won’t be thinking about rate cuts “until well into 2024,” and indicated he thinks a rate hike would be more likely at this point.

However, Bostic explained that the appropriate policy is to now wait to see how much the Fed’s previous moves, which raised rates 10 times since  March 2022, will impact the economy.

Chicago Fed President Austan Goolsbee, also on CNBC, said the full impact of Fed actions have yet to be felt, and that it’s important to get inflation “back to the correct path” without causing a recession. He noted that he is taking a more cautious approach to policymaking amid a time of high uncertainty. Goolsbee indicated he would be watching credit stresses, debt ceiling negotiations, the labor market, and prices ahead of the Fed’s next meeting in June.

Minneapolis Fed President Neel Kashkari said at an event in St. Paul that even though consumer prices edged down in April, “We should not be fooled by a few months of positive data." He added “we need to finish the job” in bringing down inflation. 

Markets were pricing in an over 75% chance that the Fed would not raise interest rates at its next meeting in June, according to fed funds futures data collected by CME Group.