Fed's Harker: Rate Cuts Still Possible Amid Data Concerns

Fed's Harker: Rate Cuts Possible Amid Data Concerns

Philadelphia Federal Reserve President Patrick Harker, nearing retirement, indicated that interest rate cuts remain a possibility this year, contingent on the evolving economic landscape.

Data Quality Concerns

Harker also expressed apprehension regarding the quality of economic data used by policymakers. He noted that the data is “not good” and “not getting better,” which impacts decision-making.

Monetary Policy Outlook

In a Reuters interview, Harker said, “it’s possible, I would never take it off the table” when asked about easing monetary policy. He elaborated that if inflation remains stable while unemployment increases, he could foresee “making one or more cuts this year.”

Upcoming Fed Meeting

The Fed is anticipated to maintain current interest rates at its upcoming meeting. However, uncertainty looms over future policy due to potential trade policy impacts on inflation and employment.

Impact of Data on Policy

Harker's concerns about data reliability stem from reports of reduced resources for compiling essential economic indicators such as the Consumer Price Index.