Federal Reserve's Barkin: Changes in U.S. economic activity are limited, and interest rates are expected to adjust moderately
The President of the Federal Reserve Bank of Richmond, Thomas Barkin, stated that he expects limited changes in U.S. economic activity for the remainder of the year, and therefore the adjustments to the Federal Reserve's interest rates may be relatively moderate. He pointed out that the mild fluctuations in the economy will lead to slight adjustments in interest rates, but the final decision will depend on the performance of future economic data. Investors generally expect the Federal Reserve to cut interest rates at the September meeting, but Barkin did not provide a clear signal, stating that he would make a judgment based on all information on the day of the meeting
According to the Zhitong Finance APP, the President of the Federal Reserve Bank of Richmond, Thomas Barkin, stated on Tuesday that given his expectation of limited changes in U.S. economic activity for the remainder of the year, the Federal Reserve's interest rate adjustments may also be relatively moderate.
"What I see is a mild fluctuation in the economy," Barkin said in an interview after an event in Blacksburg, Virginia. "If the economy is only experiencing mild fluctuations, then interest rates will also be adjusted slightly accordingly." However, he emphasized that this is just a current prediction and ultimately depends on future economic data performance, "Everything will be judged at the time of the meeting."
Currently, investors generally expect the Federal Reserve to cut interest rates at the September meeting. Previously, Federal Reserve Chairman Jerome Powell pointed out at the Jackson Hole annual meeting last week that the downside risks facing the labor market are increasing, and the risk balance is shifting, which may require adjustments to the monetary policy stance.
This means that there will be intense discussions within the Federal Reserve regarding the policy path for the remaining two meetings of the year (October and December) after the September meeting. The dot plot released in June showed that most officials expect at least two rate cuts this year, but a considerable number of officials prefer only one cut or no cuts at all. After the September meeting, the Federal Reserve will release its latest economic and interest rate forecasts.
Regarding his inclination for the September meeting, Barkin did not give a clear signal. He said, "I have three and a half weeks left, and on the day of the meeting, I will make the best judgment based on all the information."
