Fed's Bostic: Economic outcome depends on administration policy
|Federal Reserve (Fed) Bank of Atlanta President Raphael Bostic noted during the early Tuesday market session that the Fed still has a long way to go to hit its 2% inflation mandate, complicating market expectations for further rate cuts.
Key highlights
Variety of potential results has increased.
Boundaries of what I thought could be possible have been exceeded.
Labor market is maintaining full employment.
We still have a ways to go on inflation.
Still have a long way to reach 2% inflation mandate.
The Fed is unable to make bold moves in any direction.
There is a thick fog ahead, the economy is on a big pause.
Businesses, households lack confidence in making significant investments.
Tariffs imply prices are likely to increase, so timing of reaching inflation target is likely to be delayed.
Tariffs to place upward pressure on prices.
Bostic still projects economic growth of over 1% this year.
Where economy lands depends on specifics of government policies.
Bold moves with policy not prudent.
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