Fed’s Bowman says rate cuts are concerning
2024.11.20 14:39
By Ann Saphir
(Reuters) – Federal Reserve Governor Michelle Bowman on Wednesday expressed discomfort with the U.S. central bank cutting interest rates while inflation continues to run above the Fed’s 2% goal, adding a bit more color to her call for a cautious approach to further rate reductions.
“It’s concerning to me that we’re recalibrating policy, but we haven’t yet achieved our inflation goal,” Bowman said at an event in West Palm Beach, Florida.
The remark came in answer to one of several audience questions, a couple of which drew unusually personal responses from the generally reserved policymaker.
Asked about the effect of changes to immigration policy on inflation and low-wage labor, Bowman urged a patient and cautious approach.
Noting that her family’s bank in Kansas primarily serves ranchers and farmers, she said it’s very difficult to find people to work in agricultural jobs. “We need people to work across this country and we need policies that will facilitate that,” she said.
President-elect Donald Trump, who nominated Bowman to her job six years ago during his first term, has promised to crack down on immigration and deport migrants after he takes office in January.
Bowman, whose father was in the Air Force, teared up as she responded to a question about how growing up in a military family had shaped her leadership style, saying flexibility is key to coping with frequent childhood household moves.
Flexibility is a frequent theme in Bowman’s public remarks, and Wednesday was no different, as she emphasized the importance of optionality on rate decisions and the need to tailor banking regulation to size so that smaller community banks are not overburdened.
