Fed's Bostic: US economy is definitely slowing
Atlanta Federal Reserve bank president Raphael Bostic said on Friday that how the economy evolves will shape what the Federal Reserve has to do, as reported by Reuters.
Key takeaways
"The US economy is definitely slowing."
"Housing and other interest rate sectors have seen significant slowing, business leaders see labor markets easing."
"It's still not easy to find workers but it is easier."
"Slowing so far is at a steady, gradual pace, so demand-supply imbalance is not changing rapidly, process will take some time."
"The US has a lot of momentum to absorb tje Fed policy and avoid a significant contraction."
"Inflation is too high and the fed is going to do all it can to move it down."
"US may have gotten to a peak of inflation, signs that things are moving in a positive direction."
"Expect job market pressure to ease with unemployment at around 4% at year's end, no major cratering of jobs."
"Still more work to do on the policy rate."
"Need a target rate above 5%, though not a lot above."
Expect Fed to hold at a peak policy rate for an extended period, well into 2024."
"Public seems to accept that Fed will get to where it needs to be."
Market reaction
The US Dollar continues to weaken against its rivals following these comments and the US Dollar Index was last seen losing 0.9% on a daily basis at 104.20.
Author
Eren Sengezer
FXStreet
As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.
