Fed exec reveals what needs to happen before interest rates are lowered
Inflation needs to be brought under better control before the Federal Reserve starts reversing its monetary policy of boosting interest rates, a Miami-based regional executive with the Federal Reserve Bank of Atlanta said Tuesday during a regional economic summit in Key Biscayne.
The U.S. Consumer Price Index (CPI) in February was 6% over the past 12 months, the eighth consecutive monthly drop. Yet, prices need to fall in a greater variety of goods and services, said Shari Bower, vice president and regional executive of the Miami branch of the Fed’s bank in Atlanta.
Although trending down, more than 60% of items in the basket of goods factored into the CPI saw price rises of more than 5% last month, she said, speaking to about 300 people at the South Florida Economic Summit held by the Greater Miami Chamber of Commerce.
“We’re seeing inflation come down for specific items but not across the board,” Bower said.
In the most recent consumer-price information, the Miami metropolitan area posted the highest cost-of-living increase among major U.S. cities, according to December data released in February by the U.S. Bureau of Labor Statistics. It reflects the tough daily reality for many locals who work outside of technology, finance or law — sectors paying many workers six-figure salaries and head-spinning annual bonuses on top of that.