He needs to observe a period of favorable inflation, moderating demand and expanding supply before he will have confidence for a rate cutThe conditions could take months, or more-likely quarters to play outIf inflation becomes stuck meaningfully above 2% or moves higher, he would support additional tighteningSays he will remain vigilant until inflation is clearly and convincingly on its way back to 2%Retail sales for May suggests aggregate demand is growing at a moderate pace so far in Q2Expects consumptio nto moderate in coming quarters without stallingLabor market no longer seems overheated but remains tightExpects some further cooling in the labor market in the coming monthsThere are potential early signs of continued progress on inflationPCE should show welcome downshift in inflation in May
These are the first real comments from Musalem and he sure sounds like a hawk. He votes in 2025.
This article was written by Adam Button at www.forexlive.com.
