Federal Reserve Bank of Atlanta president Raphael Bostic maintains his view that one interest-rate cut will be appropriate in 2025, provided the labour market remains solid. Bostic stated that his outlook hinges on the continued strength of the labour market. Should the labour market weaken considerably, he noted that the balance of risks would shift, potentially altering the appropriate path forward. Separately, US Treasury secretary Jacob Bessent urged the Fed to lower rates by 150 basis points or more, suggesting a potential 50 basis-point cut as early as September.
Chicago Fed president Austan Goolsbee commented that the central bank’s upcoming meetings would be ‘live’ events, as policymakers grapple with interpreting mixed economic data to determine how best to adjust interest rates. Goolsbee did not indicate a specific direction he might favour. A surprisingly weak jobs report for July, coupled with downward revisions to previous months’ data, has seemingly deepened the existing divisions among Fed policymakers regarding the necessity of a rate cut at their next meeting in September.
Kansas City Fed president Jeff Schmid expressed that he remains unconvinced and prefers rates to remain restrictive. Richmond Fed president Tom Barkin stated that it remains unclear whether the central bank should prioritise controlling inflation or bolstering the job market. In contrast, San Francisco Fed president Mary Daly and Minneapolis Fed president Neel Kashkari have voiced a more receptive stance towards a rate cut. Governors Christopher Waller and Michelle Bowman previously favoured a rate cut due to concerns about the labour market when the Federal Open Market Committee voted to maintain current rates on July 30.
