Goolsbee Says Fed Risks ‘Golden Path’ If It Doesn’t Cut Soon
- Chicago Fed chief says real rates have tightened substantially
- Goolsbee declines to say when first cut might be appropriate
Austan Goolsbee
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Federal Reserve Bank of Chicago President Austan Goolsbee suggested the central bank may need to lower borrowing costs soon in order to avoid a sharper deterioration in the labor market, which has cooled in recent months.
While the Fed’s inflation fight is ongoing, multiple months of improving data have reassured him that officials are back on track to bring inflation down to their 2% goal, Goolsbee said. But he said the labor market is “definitely an area of concern,” noting that keeping interest rates elevated while price pressures ease means monetary policy has “tightened substantially.”