Reports of rising inflation rates over the course of the day have raised concerns about the market and the implications for policy. In one of the meetings, the President of the Federal Reserve of Atlanta, Raphael Bostic has appeared in giving an opinion.
According to him, the central bank's loose policy is appropriate despite rising inflation in the economy. He added that the United States still needs to create 8 million jobs to reach the level enjoyed before the pandemic. Thus he thinks a loose policy at this point is appropriate to the situation.
In a recent The Fed statement, The Fed kept its benchmark short-term lending rate close to zero and bought bonds at least $ 120 billion per month.
The consumer price index (CPI) in April rose 4.2% far exceeding market expectations. Even so the NFP employment data only increased 266,000 compared to the projection of 1 million.
On that basis, he personally argues that now is not the time to make changes in policy.
The Fed is committed to keeping policy up to achieving the goal of complete and inclusive employment, and will let inflation run above the 2% target so that the average is around that level for the long term.
Bostic even considers the rise in inflation as a positive sign. Now it depends on how far the economy grows.
