Fed's Bowman open to rate cut in July due to economic concerns

From Yahoo Finance: 2025-06-23 10:06:00

Federal Reserve Vice Chair for Supervision Michelle Bowman suggests cutting interest rates due to concerns about the job market and minimal inflation impact from tariffs. She supports lowering rates to sustain a healthy labor market. Fed officials remain cautious amid economic uncertainty caused by trade policy.

Bowman, speaking in Prague, believes inflation is heading back to 2% and supports adjusting the policy rate if inflation remains low. She sees clearer economic outlook and is open to rate cuts. Fed Governor Waller also considers a rate cut at the next meeting.

President Trump has pressured the Fed for large rate cuts amid insults to Chair Powell. Bowman acknowledges a strong job market but expresses concerns for the future. She notes potential downside risks and fragility in the labor market.

Bowman remains optimistic about inflation, stating that any upward pressure from tariffs is offset by other factors. She sees core inflation moving closer to the 2% target. The Fed official’s dovish stance aligns with concerns about the job market and inflation outlook.

Read more: Fed’s Bowman open to cutting rates at July policy meeting