Atlanta Fed’s Bostic Says Firm Jobs Market Allows Fed to Wait on Rates

Atlanta Federal Reserve President Raphael Bostic said the central bank can afford to wait before making its next policy adjustment because the labor market remains sufficiently strong. “We have the luxury today to wait,” he said Wednesday, noting that employment conditions, while softer in the past three months, still provide the Federal Open Market Committee with breathing room. Bostic added that low- to moderate-income consumers are beginning to feel stress that is spreading up the income scale, and that small businesses are facing greater pressure than larger firms. He pointed to the Atlanta Fed’s GDPNow model, which currently projects 2.5% annualised growth for the third quarter, and cited the bank’s sticky-price consumer-price index, up 3.4% from a year earlier, as evidence that inflation is moderating only gradually. Market pricing implies expectations for a rate cut as soon as September, but Bostic’s remarks suggest he favors holding steady until more data clarify the economy’s direction.