Fed’s Bostic sees two rate cuts, soft landing

Clarity emerges: Bostic speaking during an interview in Atlanta, Georgia. He says inflation has fallen faster than he anticipated since July. — Bloomberg

WASHINGTON: The US central bank can begin reducing interest rates “sometime in the third quarter” of 2024 if inflation falls as expected, Atlanta Federal Reserve president Raphael Bostic says, pushing back against expectations of an imminent move but outlining a deliberative process that will gather steam in coming weeks.

Bostic said he expects inflation, as measured by the personal consumption expenditures (PCE) price index, to end 2024 at around 2.4%, enough progress towards the Fed’s 2% target to warrant two quarter-percentage-point rate cuts over the second half of next year.