FED Member Goolsbee Makes Surprising Statements – Speaks Positively About Interest Rate Cuts

FED member Austan Goolsbee made important assessments regarding recent economic developments.

Goolsbee said that while inflation data has been quite positive so far, the direct impact of the customs duties has been surprisingly limited. However, he said he is not sure if this situation will continue in the next 1-2 months.

“Despite all the 'dust' from all these tariffs, I still think interest rates could come down in the next 12-18 months,” Goolsbee said. He also noted that the Fed's dual goals of price stability and maximum employment would look pretty good if the current volatility were overcome.

Goolsbee, who has taken a cautious stance on the impact of customs duties on inflation, said he was hesitant to say the impact would be temporary. He added that the latest Personal Consumption Expenditures (PCE) inflation data could be the “last vestige” of the period before the customs duty impact.

FED Chairman Powell, who made a speech at the same time, did not comment on expectations regarding the economy and interest rates.

*This is not investment advice.