Fed officials' policy leans toward "neutral", but expects policy clarity after Trump takes office

U.S. Federal Reserve officials are taking a "neutral" policy stance, noting the economy's strength and waiting for more clarity on Donald Trump's policies. "I expect that the coming months should provide clarity on the incoming administration's policies and the continuation of inflation pressures in 2024," Fed Governor Michelle W. Bowman said in a speech in California on January 9. Bowman's speech, as well as that of Kansas City Fed President Jeff Schmid on the same day, suggested that further rate cuts may not be necessary as the U.S. economy is strong through the end of 2024 and inflation remains "above our 2% target." "I believe we are close to the point where the economy needs neither restrictions nor support, and policy should be neutral," Schmid said. (Cointelegraph)