The Fed's Musalem:
- I could support a path with another cut if more risk to jobs emerge and inflation remains contained
- Fed should not be on a preset course, and followed balance approach
- Sees limited space before rate cuts would make policy accomodative
- Important for the Fed to be cautious right now
- Does not make decisions on one data point amid broader shutdown.
- Important for the Fed to go meeting by meeting on policy deliberation
- Weare in a particulary uncertain moment
- It is premature what to say comes with FOMC meetings after October
- Tariff impact still flowing into the economy
- Tariffs will work through the economy into the middle of next year
- Retailer are feeling increased pressure to pass on tariffs
- Consumers facing firms facing more trouble passing throuh tariffs
- Purchasing power still an issue for many Americans
- Inflation is still a very big thing for consumers
- it is really important for the Fed to get inflation back to 2%.
- Some are saying non-interest rate related costs matter more right now.
- Tariffs don't appear to be passing through to services.
- Services inflation has been at high level, need more work to lower.
- He is totally committed to a target of 2%, believes Fed supports the same.
- By 2nd half of 2026 will move back toward 2% inflation, but needs policy to lean against inflation.
- Business contacts say that the jobs market has cooled.
- Labor market is not a source of inflation.
- The job market is near full employment right now.
- Job gains have been affected by immigration changes
- job market breakeven is between 30,000 and 80,000.
- We could see negative payroll prints but unemployment may not move.
- It is not seeing any increase in layoffs.
- We are not in imminent problem for job market but risks have increased.
- Monetary policy is somewhere between restrictive and neutral.
- Financial conditions are accommodative right now
- Equity prices are not a key part of thinking about the economy.
- He always have to worry about credit market risks.
- Credit conditions are really good now.
- Low probability that the Fed leader will not be qualified
