Fed’s Kugler, Daly says job is not done on inflation Via Reuters

Posted by Ann Saphir

(Reuters) – Two Federal Reserve policymakers on Saturday said they felt the U.S. central bank’s job on controlling inflation was not done, but they also indicated they did not want to risk disrupting the labor market as they try to complete the job.

The statements, from Governor Adriana Kugler and San Francisco Fed President Mary Daly, highlight the difficult balancing act facing America’s bankers this year as they look to slow their pace of lending. reduce the rate. The fund lowered short-term rates by a full percentage point last year, to a current range of 4.25%-4.50%.

Inflation at the Fed’s preferred rate has fallen well from its mid-2022 peak of around 7%, registering 2.4% in November. Still, that’s above the Fed’s 2% target, and in December policymakers predicted slower progress toward that goal than they had previously expected.

“We are fully aware that we are not there yet – nobody is popping champagne anywhere,” Kugler said at the annual meeting of the American Economic Association in San Francisco. “And at the same time … we want the unemployment rate to stay where it is” and not increase rapidly.

In November, unemployment was 4.2%, which corresponds to his view and his colleague Daly with more work, the second objective of the Fed as well as its objective of price stability.

“Right now, I don’t want to see a slowdown in the labor market – maybe it’s slowly moving slowly and fractions in a given month, but certainly not a further decrease in the labor market,” said Daly, who was talking about. the same panel.

Policymakers were not asked, or offered to comment, on the potential impact of incoming president Donald Trump’s economic policies, including tariffs and cuts taxes, which some believe could boost growth and rein in inflation.

Two Federal Reserve policymakers on Saturday said they felt the US central bank’s job in controlling inflation was not done, but also signaled they did not want to risk damaging the labor market when they are still trying to finish the job.

The statements, from Governor Adriana Kugler and San Francisco Fed President Mary Daly, highlight the difficult balancing act facing America’s bankers this year as they look to slow their pace of lending. reduce the rate. The fund lowered short-term rates by a full percentage point last year, to the current range of 4.25%-4.50%.

Inflation at the Fed’s preferred rate has fallen well from its mid-2022 peak of around 7%, registering 2.4% in November. Still, that’s above the Fed’s 2% target, and in December policymakers predicted slower progress toward that goal than they had previously expected.

“We are fully aware that we are not there yet – nobody is popping champagne anywhere,” Kugler said at the annual meeting of the American Economic Association in San Francisco. “And at the same time … we want the unemployment rate to stay where it is” and not increase rapidly.

In November, unemployment was 4.2%, which corresponds to his view and his colleague Daly with more work, the second objective of the Fed as well as its objective of price stability.

“Right now, I don’t want to see a slowdown in the labor market – maybe it’s slowly moving slowly and fractions in a given month, but certainly not a further decrease in the labor market,” said Daly, who was talking about. the same panel.

Policymakers were not asked, or offered to comment, on the potential impact of incoming president Donald Trump’s economic policies, including tariffs and cuts taxes, which some believe could boost growth and rein in inflation.

Two Federal Reserve policymakers on Saturday said they felt the US central bank’s job in controlling inflation was not done, but also signaled they did not want to risk damaging the labor market when they are still trying to finish the job.

The statements, from Governor Adriana Kugler and San Francisco Fed President Mary Daly, highlight the difficult balancing act facing America’s bankers this year as they look to slow their pace of lending. reduce the rate. The fund lowered short-term rates by a full percentage point last year, to a current range of 4.25%-4.50%.

Inflation at the Fed’s preferred rate has fallen well from its mid-2022 peak of around 7%, registering 2.4% in November. Still, that’s above the Fed’s 2% target, and in December policymakers predicted slower progress toward that goal than they had previously expected.

“We are fully aware that we are not there yet – nobody is popping champagne anywhere,” Kugler said at the annual meeting of the American Economic Association in San Francisco. “And at the same time … we want the unemployment rate to stay where it is” and not increase rapidly.

In November, unemployment was 4.2%, which corresponds to his view and his colleague Daly with more work, the second objective of the Fed as well as its objective of price stability.

“Right now, I don’t want to see a slowdown in the labor market – maybe it’s slowly moving slowly and fractions in a given month, but certainly not a further decrease in the labor market,” said Daly, who was talking about. the same panel.

Policymakers were not asked, or offered to comment, on the potential impact of incoming president Donald Trump’s economic policies, including tariffs and cuts taxes, which some believe could boost growth and rein in inflation.