In one of the interviews, the President of the Federal Reserve Bank of Boston, Susan Collins, stated that the US Fed may start easing interest rates if inflation continues to show signs of decline amid a strong labor market.
According to Collins, “If the data continues to develop as I expect, I believe it will be appropriate to start adjusting policy and loosen restrictions on interest rates in the near future. My outlook is for continued gradual reductions towards our 2% target amid a healthy labor market.”
Fed policymakers will meet next on September 17-18 in Washington.
Collins added that the US labor market remained strong despite the latest employment figures being lower than expected. The July jobs report showed the hiring rate fell sharply, while the unemployment rate rose to 4.3%, the highest level in nearly three years.
Collins expects interest rates to be lower in the next few years, but declined to provide exact details on the duration and rate of easing.
He also noted that the Fed will have more data before their September meeting, and he did not want to speculate too early on what policy decisions might be taken. Collins also added, "The economy is growing at a rate that I think will keep the labor market strong."
