The Fed’s Jefferson is cautiously optimistic about the economy but isn’t tipping anything in terms of rate cuts or hikes.
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U.S. central bank’s current monetary policy ‘well positioned’ to deal with what likely lies ahead.
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Future moves to be driven by data and views on outlook.
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Stance allows ‘leeway’ for supply side of economy to develop.
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Jefferson says he is ‘cautiously optimistic’ about economic outlook.
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Job market stabilizing, inflation should moderate.
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Strong commitment to price stability reduces inflation risks.
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Tariffs likely represent a one-time shift in price level.
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It’s possible that stronger productivity could temper inflation pressures.
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Tariffs were key driver of inflation in 2025, price pressures should ease in 2026.
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Personal Consumption Expenditures price index likely up by 2.9% in December on year-over-year basis.
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Jefferson says he supported last year’s interest rate cuts, policy roughly in neutral stance.
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Jefferson says while upside risks remain, he expects inflation pressures to ease.
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Job market likely in balance with low-hire, low-fire environment.
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Jefferson says he expects economy to grow by 2.2% this year.
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Job market softer on reduced demand, immigration issues.
The market is pricing in a 20% chance of a Fed cut in March but that will swing based on Wednesday’s non-farm payrolls report.
This article was written by Adam Button at investinglive.com.