• Sun. Apr 21st, 2024

Fed Bank President Predicts Slowing Economic Growth, One Rate Cut This Year

BySamantha Jones

Apr 3, 2024
Cutting Rates in Q4 Given Expected Economic Evolution

Atlanta Federal Reserve Bank President Raphael Bostic has predicted that the US central bank will lower its policy rate just once this year, in an interview with CNBC on Wednesday. Despite the economy’s strong momentum, he believes that it may experience some incremental weakening and that slowing down is necessary to reach its longer-run potential. However, he expects growth and inflation to continue at a slower pace than anticipated.

Bostic emphasized the need for patience in this environment as inflation is likely to decrease at a slower rate than expected. He adjusted his forecast to include only one rate cut this year, with a potential cut in the fourth quarter if the economy evolves as he anticipates. Bostic projects that inflation will gradually decrease through 2024 and may not reach the 2% target until 2026.

Despite potential bumps in the road ahead, Bostic is not eager to disrupt the economy’s dynamics as long as inflation is moving towards the target rate. He mentioned that any degradation in employment would need to be taken into consideration, but his contacts have not expressed concerns about employment.

The market did not show an immediate reaction to Bostic’s comments, with the US Dollar Index losing only 0.04% on the day at 104.70. Overall, Bostic’s cautious outlook and forecast for a single rate cut this year suggest a measured approach to monetary policy in response to the changing economic landscape.

By Samantha Jones

As a dedicated content writer at newszxcv.com, I bring a passion for storytelling and a keen eye for detail to every piece I create. With a background in journalism and a love for crafting engaging narratives, I strive to deliver informative and captivating content that resonates with our readers. Whether I'm covering breaking news or delving into in-depth features, my goal is to inform, entertain, and inspire through the power of words. Join me on this journey as we explore the ever-evolving world of news together.

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