Fed's Bostic: Concerned rate cuts could unanchor inflation expectations

Core Viewpoint - Outgoing Atlanta Fed President Raphael Bostic expresses concerns about potential rate cuts impacting inflation expectations, emphasizing the need for the Fed to maintain a restrictive policy to control inflation [1][2]. Group 1: Inflation Concerns - Bostic believes that cutting rates could unanchor inflation expectations, with surveys indicating firms plan to continue raising prices into 2026 [2]. - He stresses the importance of the Fed prioritizing inflation control before making further economic moves, reflecting a hawkish stance [5]. Group 2: Employment and Economic Risks - Bostic acknowledges the risks associated with employment and inflation, noting that there are no riskless choices in monetary policy [4]. - He highlights the potential impact of upcoming economic stimulus, including higher refunds and Fed cuts, which could influence inflation dynamics [6]. Group 3: Labor Market Insights - The recent unemployment rate data has garnered attention, with Bostic indicating that while he expected the numbers, there is concern about future trends [3].