By CultureBanx Team
- Atlanta Fed Reserve President Raphael Bostic is keeping an open mind about continuing to raise rates
- Out of the 12 Federal Regional banks, Bostic is the only Black person on the Federal Reserve’s policy setting committee
Atlanta Fed President Raphael Bostic is keeping an open mind about continuing to raise rates. Out of the 12 Federal Regional banks, Bostic is the only Black person on the Federal Reserve’s policy setting committee, meaning there’s only one African American with a direct say on U.S. monetary policy. Bostic referenced the stronger-than-expected recent inflation and jobs reports, along with increased consumer spending as the main points fueling his economic train of thought.
Why This Matters: He is going to stay open to the possibility that if economic data comes in stronger than expected there will be a case for higher interest rates in the coming months. “There is the case that could be made that we need to go higher. Consumer spending is strong and labor markets remain quite tight and that those suggest that the economy’s strength could be a bit more than people think, which means we might need to do more,” Bostic said on a call with reporters.
The jobs report data could impact future Fed rate hikes, these are numbers Federal Reserve policymakers watch closely. They’re primarily keeping a close eye on wages for signs of inflation. The U.S. economy added 517, 000 jobs in January, and unemployment came in at 3.4%.
Bostic has previously stated that past periods of ultra-low unemployment have been followed by recessions. Ultimately, he wants the Fed to adopt a strategy that balances out super low rates while not running the risk of overheating by raising rates so much the economy tips into recession.
In addition to his role of steering monetary policy in the right direction. Bostic has been among the most outspoken Fed officials in an evolving conversation at the central bank about economic inequality. He warned that racist practices and policies, on top of their more obvious social and psychological toll, generate a lasting and pervasive drag on the economy as well, according to MarketWatch. The Atlanta Fed president has called out things like the impact of long-outlawed policies including how “redlining” Blacks out of white neighborhoods continues to influence the ability of minority families to amass wealth.
What’s Next: In the meantime, back to monetary tightening, the central bank is widely expected to hike its benchmark interest rate at its next two-day meeting happening March 15-16.
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