Fed s Barkin reiterated his patience in cutting interest rates

Mondo Finance Updated on 2024-02-09

**: Global Market Broadcast.

Richmond Fed President Thomas Barkin reiterated that policymakers have time to be patient with the timing of rate cuts, given the strength of the labor market and the continued decline in inflation.

The labor market is still very strong, and it's very gratifying to see inflation come down and hopefully it will continue to fall," Barkin said in an interview on Thursday, "and I think we have time to be patient." ”

Barkin, who has a vote on monetary policy this year, added that they will have access to "extra months" of inflation data, saying he is "very keen to see this trend continue and expand." He noted that goods have played a huge role in the pullback in U.S. price growth.

The Federal Reserve kept interest rates unchanged at its fourth consecutive meeting last month. Chair Jerome Powell and others** took turns pouring cold water on expectations of a rate cut as early as March, saying the policy committee would like to see more data to boost confidence that inflation will continue to fall to 2%.

Asked if he agreed with Powell's statement that a rate cut in March was unlikely, Barkin said: "I never prejudge the meeting, and I don't predict the March meeting. ”

Let's wait and see, but I always think that Chairman Powell's statement is representative of the Committee," he said.

Mr Barkin said the risk of commercial property stress was a well-known and important issue.

"In the banks that we regulate, we spend a lot of time dealing with them, productively researching real estate assets and trying to understand what the risks are and what the reserves are to deal with those risks," he said. ”

Shares of New York Community Bancorp have tumbled this year after regional banks unexpectedly disclosed losses related to deteriorating credit quality. The incident has raised concerns about the potential spillover to other U.S. banks for the impact on commercial real estate lending.

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