Critical Statements from Michelle Bowman, One of the FED’s Most Hawkish Voices: Announcement of Expected Date for Interest Rate Cut
Fed member Michelle Bowman has made statements indicating that now is not the right time to start lowering interest rates.
Despite expectations for the FED interest rate decision on July 31 focusing on maintaining interest rates, there is a 89.7% chance of interest rates remaining constant, as per CME FedWatch.
While the earliest date for the FED to begin reducing interest rates is September, experts have varying predictions for the number of interest rate cuts in 2024, with some expecting one in September and others anticipating two in September and December.
Bowman, a voting member of the FOMC, reiterated her opinion in London today that keeping the policy rate constant “for a while” would be sufficient to control inflation.
Expressing caution about interest rate cuts, Bowman stated that it is not yet appropriate to begin reducing interest rates and that they are open to increasing interest rates if inflation does not decrease.
Pointing to 2025 for interest rate cuts, Bowman mentioned that if economic data shows inflation trending towards their 2 percent target, gradual reductions in interest rates will be considered to prevent monetary policy from becoming overly restrictive.
However, Bowman does not foresee the possibility of interest rate cuts for 2024, expecting them to begin in 2025.
Bowman, known for her hawkish stance, emphasized that there are still potential risks regarding inflation, and that interest rates should rise if inflation stops declining or begins to rise again.
Regarding Bitcoin, its peak of $69,000 in November 2021 coincided with the FED’s interest rate increases. It is speculated that a policy change and a potential interest rate cut could lead to a resurgence in BTC and cryptocurrencies, as was seen prior to the bear market.
Please note that this article does not constitute investment advice.