June 18, 2024 at 06:21PM
He needs to observe a period of favorable inflation, moderating demand and expanding supply before he will have confidence for a rate cut
The conditions could take months, or more-likely quarters to play out
If inflation becomes stuck meaningfully above 2% or moves higher, he would support additional tightening
Says he will remain vigilant until inflation is clearly and convincingly on its way back to 2%
Retail sales for May suggests aggregate demand is growing at a moderate pace so far in Q2
Expects consumptio nto moderate in coming quarters without stalling
Labor market no longer seems overheated but remains tight
Expects some further cooling in the labor market in the coming months
There are potential early signs of continued progress on inflation
PCE should show welcome downshift in inflation in May
These are the first real comments from Musalem and he sure sounds like a hawk. He votes in 2025.
This article was written by Adam Button at www.forexlive.com.