Washington (AWP/AFP) – An official of the Federal Reserve (Fed), who recently opposed the status quo on American interest rates, estimates on Saturday that the monetary institution should be “proactive” to preserve employment in the United States and lower the rates three times in the coming months.
“A proactive approach (…) would avoid an additional degradation of labor market conditions,” said Michelle Bowman in a speech to be made in Colorado, according to the text communicated in advance to journalists.
She adds that she still provides three reductions in the Fed rates for 2025, knowing that none has yet taken place and that three scheduled meetings remain by the end of the year.
Vice-president of the Central Bank of the United States, responsible for banking regulation, Michelle Bowman distinguished herself last week by opposing the majority of her colleagues at the monetary policy meeting.
Governor Christopher Waller also voted against the decision to leave interest rates unchanged for the fifth time in a row.
Both, who were appointed to the Fed by President Donald Trump during his first mandate, pleaded for a quarter of a percentage point to give an incorrect to economic activity.
In her speech, Ms. Bowman explains that she had spotted “signs of fragility” on the job market.
They have since “agreed”, she said.
Two days after the federal reserve meeting, the monthly employment report in the United States sparked a blast in economic environments, with low job creations and significant data revisions to show that the labor market goes much less than expected.
President Donald Trump dismissed the economist supervising the publication, believing that the figures had been “manipulated” for political purposes, to harm him.
Ms. Bowman is not going on this ground, while regretting that employment reports have become less reliable “in recent years”.
It considers that the risks weighing on employment are now greater than those linked to the increase in the cost of living. She repeats several times that the new customs duties set up by the American executive should have an only temporary impact on inflation.
She thinks “that inflation will return to 2% when these effects dissipate”.
AFP/Rp