Fed Goolsbee signals Fed policy is still restrictive but no comeback to prepandemic interest rates levels💵

Fed's Goolsbee

• I do not think rates will go back to where they were before the pandemic.  I still feel good about a 12 to 18-month path to the neutral interest rate.
• It is possible long rates are rising because growth is expected to be higher, or because markets think the Fed might slow its rate cuts.
• The Fed has to figure out why the 10 year is rising, and keep an eye on long rates.
• I have seen prior moves up in import prices that were just a bump in the road.
• What matters to the Fed is the new months of inflation data that are coming in, the Fed must reach 2%.
• Rates are likely to need to fall over the next year. The Fed is not going to move the inflation goalposts.
• Core PCE is still too high. Policy has nothing to do with the outcome of the election but the condition of the economy.
• If there is disagreement over the neutral rate, it does make sense to start slowing the pace of rate cuts.
• As long as inflation continues to come down, rates will be a lot lower than they are now.
• It's hard to reconcile recent weak jobs reading given storm impacts.
• The basic story of the economy remains falling inflation, and the labor market cooling to full employment
• The current Fed policy is still in restrictive posture.

EURUSD erased most of its today gains after US retail sales data and upbeat in NY Fed; now falling to 1.0533.

Source: xStation5