Federal Reserve officials reiterate: Need to see more evidence of declining inflation before cutting interest rates

According to the Wise Finance APP, Federal Reserve officials maintained interest rates unchanged during last week's meeting and reduced their expected number of rate cuts for this year from 3 times as forecasted in March to 1 time. Policymakers stated that they would like to see more evidence that inflation is moving towards the 2% target before they have confidence to begin cutting rates. 2024 FOMC voter and Richmond Fed President Barkin stated on Thursday that he needs further clarity on the inflation path before cutting rates. Barkin said: "My personal view is, let's get more conviction before we act." He reiterated that he needs to see inflation persistently and broadly moving towards the Fed's 2% target before adjusting borrowing costs. He mentioned that the current policy stance is appropriate, and the Fed has the firepower needed to contain inflation. When asked whether the Fed would cut rates once and then keep rates unchanged, Barkin said it depends on the economy. He believed that if the current situation remains unchanged, now may not be the best time to provide guidance on subsequent policy adjustments. He said: "Sometimes we want to provide forward guidance, and we have done so. But I don't think now is the time. Now is not the time to provide forward guidance." Chicago Fed President Evans stated on Thursday that if inflation continues to cool as it did last month, the Fed will have the ability to cut rates. Evans appreciated the recent May Consumer Price Index report, which showed inflation slowing for the second consecutive month after an unexpected rise at the beginning of the year. Evans said: "If we get more inflation data like we just saw, which is very strong, very encouraging - more like around 2% in the second half of last year - then my view is that we can cut rates."