The Federal Reserve has come forward to "pour cold water", saying that it is too early to consider cutting interest rates.
Chicago Fed President Goolsbee said, "It is too early to declare the Fed's victory in the fight against inflation, and the rate cut will be based on upcoming economic data." ”
Goolsbee noted that inflation is still far from the Fed's 2% target. He also said that risks are becoming more balanced, suggesting that the Fed may need to start turning its attention to its mission of maximizing employment.
New York Fed President Williams also said that "we are not really talking about rate cuts," and called talk that the Fed will cut rates in March next year "premature".
Atlanta Fed President Bostic, a member of next year's FOMC vote, said he would be cautious about cutting rates too soon. He said he wanted to ensure that inflation was fully under control and that "surprises" were avoided before lowering borrowing costs.
Bostic said he wanted to be prepared to act faster if necessary because he believed the risks to the economy were "fairly balanced".
On Friday, the US will publish the Fed's favorite inflation gauge - the November PCE price index. CPI data released last week showed a rebound in core CPI in November due to rising costs for housing and other services.