Fed Governor Michelle Bowman projected the necessity of further rate hikes during a weekend speech, asserting they are likely needed to push inflation back down to the Fed’s 2% target.
Bowman expressed her support for Fed’s rate hike in July and stated, “I also expect that additional rate increases will likely be needed to get inflation on a path down to the FOMC’s 2 percent target.”
However, Bowman was careful to emphasize that Fed policy is “not on a preset course”. Further decisions will be based on “incoming data and its implications for the economic outlook,” she stated.
She said, “We should remain willing to raise the federal funds rate at a future meeting if the incoming data indicate that progress on inflation has stalled.”
While recent lower inflation reading was seen as positive, Bowman asserted the necessity of consistent evidence of inflation moving meaningfully toward the 2% goal when contemplating additional rate hikes and the duration of restrictive federal funds rates.
