Fed's Barkin
- Consumer demand remains healthy, though slowing
- Labor market reacceleration at this point seems unlikely
- There is more uncertainty around the path of inflation given that progress over last six months has been so reliant on goods
- Companies still trying to raise prices; need to see how consumers and competitors react
- First quarter will be important given that businesses tend to mark up at the start of the year
- US still at a point where inflation is above target and employment is near max
- Labor market is 'normalizing nicely'
- No problem 'toggling' rate to more normal levels as you build confidence inflation is falling
I think there is some real insight in these comments. The 'toggling' idea is like the Fed taking out insurance and moving down to around 4.00% if inflation stays low. The comment about Q1 pricing is an important one too, given how strong prices rose in Jan/Feb of last year.
US CPI m/m