Bowman says inflation still needs to be controlled, and the costs of further policy tightening must be weighed
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AT A GLANCE
According to a report by BlockBeats, Bowman stated that inflationary pressures persist and that further tightening of policy requires weighing the costs, but she did not explicitly call for rate hikes.
Article
⚡️ Fed Governor Bowman: Inflation still needs to be brought under control, but the costs of further tightening policy must be weighed
BlockBeats news, November 11, Michelle Bowman, Vice Chair of the Federal Reserve for Supervision, stated that inflationary pressures are currently persisting while the labor market is stabilizing, and there is still room for inflation to fall further. She expects core PCE in October to rise to 3.3% year-on-year, with rising energy prices and AI-related demand as the main drivers, but noted that the lack of progress on inflation is not caused by an overheating labor market. Bowman expects that as the pressure from the AI construction boom and the Middle East conflict gradually subsides, core PCE could move closer to 2% next year. On policy, Bowman pointed out that recent stock price declines, rising US Treasury yields, and a stronger USD have already tightened financial conditions, while the economy has strengthened since the beginning of the year.
She emphasized that financial conditions have tightened. In this context, the benefits of further monetary tightening must be carefully weighed against the costs imposed on interest-rate-sensitive sectors. Whether AI demand can sustain itself and how geopolitical risks evolve will be key factors determining the direction of monetary policy in the coming months. She did not explicitly call for rate hikes, but stressed that the Federal Reserve still needs to push inflation back to its 2% target.
Original link https://m.theblockbeats.info/flash/376645
Key points
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BlockBeats news reports that on November 11, Michelle Bowman stated that inflationary pressures are still persisting and the labor market is stabilizing.
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Bowman expects core PCE in October to rise 3.3% year-on-year, and said rising energy prices and AI-related demand are the main driving factors.
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She believes that the lack of progress on inflation is not caused by an overheated labor market, and expects core PCE to move closer to 2% next year.
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She pointed out that the recent decline in stock prices, the rise in US Treasury yields and the strengthening of USD have tightened financial conditions, and the economy has strengthened somewhat since the beginning of this year.
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She emphasized that the benefits of further tightening monetary policy must be carefully weighed against the costs imposed on interest-rate-sensitive sectors.
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The report said she did not explicitly call for an interest rate hike; whether AI demand can be sustained and how geopolitical risks evolve are important factors that will determine the direction of monetary policy in the coming months.
AI-assisted interpretation
The following is analysis, separate from reported facts. Verify important claims independently.
This report simultaneously conveys two messages: inflation still needs to be further brought under control, but financial conditions have already tightened, and whether to tighten policy further requires weighing the costs. The 3.3% figure is Bowman's forecast for October core PCE, and the expectation of moving toward 2% next year is also an outlook—it should not be treated as already-published data or a confirmed outcome.
Why it matters to readers
The report involves the trade-off between continuing to control inflation and the cost of further tightening policy, but it does not set out a clear case for raising interest rates, and it cannot be concluded from this that the policy direction has been determined.
When reading, one should distinguish between officials' forecasts, actual data, and policy decisions. What this article provides is media-recounted views of officials, not a clear interest rate hike decision, nor does it provide the actual market reaction of related assets.
Risks and unknowns
The evidence does not provide the original text of the speech, so it is impossible to verify whether the paraphrase is complete and accurate.
The body text only mentions November 11 and "next year," without specifying the exact year, so the specific time attribution remains to be confirmed.
The October core PCE year-over-year 3.3% and the move toward 2% next year are both forecasts; the evidence does not provide actual results.
Related Developments
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The persistence of AI demand, geopolitical risks, and subsequent policy directions remain undetermined.
Related concepts
Core PCE
This term is not in the glossary yet. Browse related concepts in the glossary.
