Federal Reserve Bank of Chicago president Austan Goolsbee on Wednesday said that he does not support waiting until inflation is at 2% on a 12-month basis before cutting rates. “Even if inflation comes in a bit higher for a few months, it would still be consistent with our path back to target,” he noted.
Goolsbee added that, in his view, the rate cuts should be tied to confidence in being on a path toward the Fed's target. The official also suggested that more data like we have seen in the past six months would indicate that path.