Bostick: If interest rates are cut, inflation is highly unlikely to drop to 2%. He explained that the current inflation rate is driven by factors that are not easily reversed by monetary policy alone, and that a significant reduction to 2% would require a much more aggressive approach or a change in underlying economic conditions. Therefore, policymakers should be cautious about expecting a quick decline in inflation just through lowering interest rates.
ChainCatcher reports that Fed’s Bostic stated that if interest rates are cut, inflation is highly unlikely to fall to 2%.
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Bostick: If interest rates are cut, inflation is highly unlikely to drop to 2%.
He explained that the current inflation rate is driven by factors that are not easily reversed by monetary policy alone, and that a significant reduction to 2% would require a much more aggressive approach or a change in underlying economic conditions.
Therefore, policymakers should be cautious about expecting a quick decline in inflation just through lowering interest rates.
ChainCatcher reports that Fed’s Bostic stated that if interest rates are cut, inflation is highly unlikely to fall to 2%.