Cleveland Fed President Advocates Steady Monetary Policy Amid High Inflation

Cleveland Federal Reserve President Beth Hammack stated on Friday that there is no immediate need to adjust monetary policy despite persistent high inflation. According to Jin10, Hammack delivered her remarks at the U.S. Monetary Policy Forum in New York City, emphasizing the need for the Federal Reserve to balance high inflation with a weak job market. She noted that last year's interest rate cuts have positioned current monetary policy favorably, with the central bank's rate targets having a neutral impact on the economy. Hammack expressed her view that the policy should remain unchanged for a considerable period, awaiting evidence of declining inflation and further stabilization in the labor market. She added, "Based on my baseline scenario, I believe the policy should remain on hold for quite some time, waiting for signs of inflation reduction and labor market stabilization." However, she acknowledged the possibility of alternative scenarios, indicating that interest rates pose bidirectional risks.