.jpg)
2 hours ago
2
Article content
(Bloomberg) — Federal Reserve Bank of Cleveland President Beth Hammack said monetary policy is in a good place to pause and assess the effects of 75 basis points of rate cuts in the economy during the first quarter.
THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLY
Subscribe now to read the latest news in your city and across Canada.
- Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman, and others.
- Daily content from Financial Times, the world's leading global business publication.
- Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.
- National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.
- Daily puzzles, including the New York Times Crossword.
SUBSCRIBE TO UNLOCK MORE ARTICLES
Subscribe now to read the latest news in your city and across Canada.
- Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman and others.
- Daily content from Financial Times, the world's leading global business publication.
- Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.
- National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.
- Daily puzzles, including the New York Times Crossword.
REGISTER / SIGN IN TO UNLOCK MORE ARTICLES
Create an account or sign in to continue with your reading experience.
- Access articles from across Canada with one account.
- Share your thoughts and join the conversation in the comments.
- Enjoy additional articles per month.
- Get email updates from your favourite authors.
THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK.
Create an account or sign in to continue with your reading experience.
- Access articles from across Canada with one account
- Share your thoughts and join the conversation in the comments
- Enjoy additional articles per month
- Get email updates from your favourite authors
Sign In or Create an Account
or
Article content
“Where we are today is my base case that we can stay here for some period of time until we get clearer evidence that either inflation is coming back down to target or the employment side is weakening more materially,” Hammack said in an interview for the Wall Street Journal’s Take On the Week podcast conducted Thursday and aired Sunday.
Article content
Article content
Article content
The Fed’s latest interest rate cut on Dec. 10 faced three dissents, the most since 2019. Officials are divided about the appropriate path for rates, with some policymakers more concerned about a cooling labor market and others saying the Fed should prioritize reining in above-target inflation.
Article content
By signing up you consent to receive the above newsletter from Postmedia Network Inc.
Article content
Interest-rate projections released after the meeting showed six officials preferred to leave rates unchanged.
Article content
“We took 75 basis points off of the policy rate, which should help support that labor side of our mandate, but we do need to be mindful,” said Hammack, who will be a voting member for the Federal Open Market Committee in 2026. “I’m very focused on making sure that we can get inflation back to target. That is one of our primary objectives and it’s important that we complete the job.”
Article content
Policymakers received economic data last week that had been delayed by the record-long government shutdown. While the US unemployment rate rose to 4.6% in November from 4.4% in September, the core consumer price index — which excludes volatile food and energy prices — rose 2.6% year-on-year in November, the slowest increase since 2021.
Article content
Article content
Hammack said she doesn’t put much weight on any single economic report and that the latest inflation data includes “noise” due to the lack of sampling during the shutdown.
Article content
“It’s just one number and I want to take some time,” she said. “Fortunately, we have a lot of time before our next meeting to see how the broader picture comes in.”
Article content
Hammack said inflation has been stuck near 3% for much of the past year and a half and input costs for businesses are still rising, which could lead to renewed price increases. That reinforces the need for caution, she said.
Article content
After the Fed cut rates in December, Hammack said she’d prefer interest rates to be “slightly more restrictive.”
Article content
English (US)