Here's All the Fed Takes on Inflation, Combined in one Blog

Quick Intro → (read this part)

If you didn't know, The fed is responsible for taming our nasty inflation that keeps taking our precious dollars away.

I'm guessing you feel the same way, but I'd prefer I don't end up spending more than I need to (like grocery shopping at Walmart)

Now buckle up; we'll dive into what each of these Presidents have to say. I’ll keep it short— no promises I won't put you to sleep, though

1) Austan Goolsbee — President at FRB in Chicago

"More months' of good inflation data needed" was Goolsbee's response in a recent interview with Reuters, following the CPI report that came in at 3.3%, short of expectations at 3.4%

2) Tom Barkin 👀 — President at FRB in Richmond

Barkin, a former executive at McKinsey & Company, has been the one top Fed official focused on "pricing power" as a driver of inflation this year. Barkin believes that following the Covid Pandemic, companies realized they could flex pricing power with consumers with more stimulus in the economy.

Now, with inflation being at the forefront, Barkin had this to say, "Customers and competitors are going to have to teach people that they don't have pricing power", and that demand is going to need to weaken "a little bit more" to have inflation back at our 2% target.

3) 🔥Raphael Bostic🔥 — President at FRB in Atlanta

Bostic believes the U.S. is not past the worry point for inflation. He mentioned many goods' prices are still rising faster than normal, and the labor market remains strong.

His biggest takeaway being that we need to be patient, suggesting the Fed may need to keep rates higher for longer to ensure inflation returns to the 2% target. He added,

"Job growth has been robust ... which tells me there's still a lot of energy in the economy, and it gives me comfort in staying at a more restrictive level because we're not at risk today, I don't think, of falling into a contractionary environment"

4) Susan Collins — President at FRB in Boston

In Collin's last speech, when asked about inflation, she said, "I don't overreact to a month". She also added, "I think that I am expecting to see gradual, continued disinflation. I think it's going to take longer than I thought it was going to some months ago."

5) Mary Daly 🤨— President at FRB in San Francisco

During a Q&A at Stanford in April, Daly added "Inflation was always going to be a bumpy ride". After being asked about the strength of the banking system she believed it was "strong and sound".

6) Patrick Harker — President at FRB in Philadelphia

Harker sees a lot of ‘uncertainty’ surrounding inflation, and thinks we're only getting one Fed rate cut in 2024: "one reduction in interest rates would be appropriate by year’s end"

7) Neel Kashkari 🗣️— (My Favorite) President at FRB in Minneapolis

Kashkari is the more blunt-but-honest president than most at the FRB, and he had this to say about inflation, "I have learned that the American people—and maybe people in Europe equally—really hate high inflation. I mean, really hate high inflation"

His wild take is that today, Americans have such a ‘visceral’ hatred of inflation that they’d rather have a recession than rising prices...😂

8) Lorie Logan — President at FRB in Dallas

Dallas President Lorie Logan said in June she believes inflation is still heading to the Fed's 2% target, but she can imagine "other paths" that the Fed ought to be prepared for, and it is too early to consider cutting interest rates.

"I think there's good reasons to think that we're headed to 2% - we're still on that path, perhaps a bit slower and a little bit bumpier than maybe many thought at the beginning of the year".

9) Loretta Mester 🎖️ — President at FRB in Cleveland

Mester, who's retiring this month, says May's latest inflation numbers are a ‘great gift'. Despite her comment, she still sees higher inflation risks despite our latest data.

10) Jeffrey Schmid — President at FRB in Kansas City

Earlier in May, Schmid said inflation is still too high, and the U.S. central bank has more work to do to bring it down, a signal that he supports keeping the Fed's policy rate steady for some time.

"Over time, I expect inflation to ease back towards the Fed’s 2% objective". Also mentioned, "I am prepared to be patient as this process plays out."

11) John Williams — President at FRB in New York

With markets on edge over the direction of monetary policy, Williams offered no clear indication of his position on possible interest rate cuts.

Instead, he reiterated recent positions from the central bank that it has seen a “lack of further progress”.

“The honest answer is, I just don’t know,” Williams said during a Q&A with CNBC. 

RECAP TIME!

Here's a rundown of what the Federal Reserve Presidents are saying about inflation:

1. Austan Goolsbee (Chicago): Wants more months of good inflation data.
2. Tom Barkin (Richmond): Believes pricing power needs to weaken.
3. Raphael Bostic (Atlanta): Emphasizes patience; inflation still a concern.
4. Susan Collins (Boston): Expects gradual, continued disinflation.
5. Mary Daly (San Francisco): Says inflation is a bumpy ride.
6. Patrick Harker (Philadelphia): Sees only one rate cut in 2024.
7. Neel Kashkari (Minneapolis): Stresses Americans' hatred for high inflation.
8. Lorie Logan (Dallas): Thinks inflation will hit 2%, but it's too early for cuts.
9. Loretta Mester (Cleveland): Sees higher inflation risks.
10. Jeffrey Schmid (Kansas City): Supports keeping rates steady.
11. John Williams (New York): Offers no clear stance on rate cuts.

Overall, the Fed Presidents are cautiously optimistic but not out of the woods yet. They’re keeping an eye on inflation, emphasizing patience, and suggesting that interest rates might need to stay high for a bit longer. The strong job market and pricing power dynamics are big factors in their decisions. Most agree on a gradual approach to ensure inflation hits the 2% target without rushing into rate cuts.