(Washington) A Federal Reserve (Fed) official said Thursday that if the American central bank manages to take “a golden path” by taming inflation without causing a recession, it would be “a triumph”.
Austan Goolsbee, president of the Chicago Fed regional branch and a voting member of the monetary committee this year, said it was “possible that we are on a golden path, but it is not guaranteed.”
“It would be almost unprecedented to be able to significantly lower inflation without causing a serious recession,” the official commented in an interview with public radio NPR.
“It would be a triumph that the Fed and other central banks were able to achieve this,” he said. “I think right now we can do it. In any case, that’s what we’re aiming for,” Mr. Goolsbee added.
Like his colleagues, he reiterated that the Fed remained “attentive to the economic data”.
The Federal Reserve, working to slow inflation, has raised its rates 11 times since March 2022, in order to increase the cost of credit, and thus slow down consumption and investment. In order, ultimately, to ease the pressure on prices.
Inflation stood at 3.2% year-on-year in July, according to the CPI index, while the unemployment rate has increased very little so far (at 3.8%).
US GDP growth held steady at an annualized 2.1% in the second quarter, and for the 3rd quarter the Atlanta Fed’s forecast barometer – GDPNow – is banking on an expansion of 5.6% still. at an annualized rate.
For her part, Dallas Fed President Lorie Logan said it would be “appropriate to skip” a further rate hike at the next Monetary Committee meeting on September 20.
“But jumping doesn’t mean stopping” any rate hikes, she said in a speech in Dallas.
“In the months ahead, assessment of the data and outlook may confirm that we need to do more to extinguish inflation,” Ms. Logan added.
“The Monetary Committee will keep the bucket of water handy and should not hesitate to use it if necessary,” she concluded.
