他指出：“我仍然认为，我们会继续沿着降息的政策路径前进。根据我目前掌握的所有信息，我不会偏离这条路径，也不会掉头走回头路，但沿着这条道路前进的确切速度将完全取决于即将到来的数据。”① Philadelphia Federal Reserve Chairman Huck said that the Federal Reserve plans to cut interest rates this year, but the timing depends on economic conditions; ② Huck believes that inflation will fall to the 2% target or take longer than expected, and the economy and labor market are still strong; ③ Huck will step down as Chairman of the Philadelphia Federal Reserve at the end of June.
Financial Services Association, January 10 (Editor Niu Zhanlin) On Thursday local time, Philadelphia Federal Reserve Chairman Huck said that Federal Reserve officials are still planning to lower interest rates this year, but the exact schedule will depend on the development of economic conditions.
Huck said that reducing the inflation rate to the Federal Reserve's target level of 2% may take longer than expected, and progress is uneven. However, he said the overall economy is still strong and the labor market has cooled down to the pre-pandemic trend.
He said, “I still think we will continue along the policy path of cutting interest rates. Based on all the information I have so far, I'm not going to deviate from this path or take a turn back, but the exact speed of moving along this path will depend entirely on the upcoming data.”
Federal Reserve officials cut interest rates by 25 basis points last month, and since September of last year, their benchmark interest rate has dropped by a full 1 percentage point. Federal Reserve Chairman Powell and other officials said that after data showed that the labor market was strong and inflation continued, there was room for the Federal Reserve to be more careful in cutting interest rates.
Huck expressed the same opinion, stressing that the Federal Reserve should maintain data dependency and not “act hastily.”
“I think we should pause now and see how things unfold. We can keep things as they are, of course, not too long.”
The Philadelphia Federal Reserve Chairman said that despite some risks that may affect price stability and the economy, inflation is still moving towards the 2% target path. Globally, these risks include the war in Ukraine, the conflict in the Middle East, and instability in some European governments.
Huck believes, “Within the US, the macroeconomic fundamentals are still strong, and we are awaiting potential policy changes that may have an impact on the economy.” He also added that bird flu could also affect food costs.
He also said the labor market has stabilized and remains healthy, adding that there are growing signs that low-income earners are under greater pressure, which he is concerned.
The day before, the minutes of the Federal Reserve's December meeting showed that considering that the risk of inflation is still high, Fed officials have taken a new position on interest rate cuts and decided to slow down the pace of interest rate cuts in the next few months. According to forecasts released at this conference, policymakers expect to cut interest rates only twice this year, lower than the four rate cuts predicted in September last year.
Notably, Huck will step down as Chairman of the Philadelphia Federal Reserve at the end of June. He currently appears to be opposed to the Federal Reserve cutting interest rates at the January 28-29 meeting.
