Fed’s Bostic Says He Now Might Favor More Than One 2024 Cut

(Bloomberg) -- Federal Reserve Bank of Atlanta President Raphael Bostic said it’s possible that more than one interest-rate cut may now be needed by year-end, shifting his view in the wake of data showing falling inflation and a slowing labor market.

“It may be appropriate to pull forward our first rate move,” Bostic said in a CNBC interview from Jackson Hole, Wyoming, where the Kansas City Fed is hosting the central bank’s annual symposium. Asked if he favors more than one cut this year, he said, “It is in play.”

The Atlanta Fed president said that “inflation has moved a lot faster than I anticipated,” speaking in a separate Bloomberg TV interview. And the labor market has had “a big change,” with unemployment rising, though it is still “solid,” he said.

The size of the first rate cut — a quarter point or a half point — will depend on the data, Bostic said. If unemployment spikes in an unexpected way, “we have to move bigger,” he said. Bostic also cautioned that if inflation came in hot, that would argue for no move.

The “vast majority” of Fed policymakers expected that it would likely be appropriate to ease monetary policy in September if data come is about as expected, according to minutes of the Federal Open Market Committee July meeting released Wednesday. Several saw a plausible case for cutting rates at the July meeting.

(Adds comments from Bloomberg interview, starting in third paragraph.)