Fed's Bostic: Keeping ‘options open’ for December rate decision

Federal Reserve Bank of Atlanta President Raphael Bostic said on Monday that he’s undecided on whether an interest-rate cut is needed in the December meeting, but still believes Fed officials should continue lowering rates over the coming months, per Bloomberg.  

Key quotes

“The risks to achieving the committee’s dual mandates of maximum employment and price stability have shifted such that they are roughly in balance, so we likewise should begin shifting monetary policy toward a stance that neither stimulates nor restrains economic activity,”

“I’m keeping my options open” over whether he will support a rate reduction when officials gather in Washington Dec. 17-18.”

“None of these trends send a strong signal that the labor market is rapidly deteriorating nor extremely tight.”

“Instead, they suggest that the labor market is cooling in a largely orderly fashion in the face of higher interest rates, a perspective we also hear from our business contacts.”

“There are certainly upside risks to price stability,” Bostic said, but added, “I do not view the recent bumpiness as a sign that progress toward price stability has completely stalled.”

“One of the things that we have seen over the last six or seven years is that there are lots of proposals that get floated around, and they change a lot as you go through.”  

Market reaction 

The US Dollar Index (DXY) is trading 0.01% lower on the day at 106.38, as of writing.