Goolsbee, the president of the Chicago Fed, gave an interview today in which he commented on the current monetary policy and the latest macroeconomic data. According to the banker, the exact level of tightening is extremely difficult to determine, and the relationship between bond yields, inflation, and economic growth is complicated. Nevertheless, the current data suggest that the Fed is approaching its goal. The labor market is reaching a more balanced level, and inflation continues to be on a downward trend—potentially the fastest of this century. Goolsbee emphasized that the so-called "Golden Path" is still achievable in his opinion. Future Fed decisions will depend on incoming data.
Meanwhile, Kashkari, the president of the Federal Reserve Bank of Minneapolis, stressed that the Fed's fight against inflation is not over yet, and further rate hikes are on the table if necessary. Kashkari observed that the economy does not show significant signs of weakening, and the labor market remains strong. He clarified that there are no discussions at the Fed about rate cuts and expressed concerns that the current economic activity might suggest that not enough has been done to cope with inflation. Kashkari insists that inflation and labor market data should guide the Fed's decisions on interest rates.
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Since yesterday, the dollar has begun to strengthen again dragging down the indices. After significant increases on EURUSD last week, we are now seeing a correction. EURUSD is losing 0.45% and is trading at 1.0675. source: xStation 5
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