Richmond Fed President Discusses Economic Flexibility

Richmond Fed President Thomas Barkin stated that the U.S. economy is currently in a favorable position, with inflation nearing the Federal Reserve's 2% target and a resilient labor market. He highlighted that the Fed has lowered borrowing costs, bringing the policy rate to a range of 4.50%-4.75%, allowing for more flexible responses to evolving economic conditions. Barkin noted that a more selective consumer base and a productive workforce have contributed to moderating inflation pressures. He emphasized that the Fed is prepared to respond to potential risks, whether inflation pressures increase or the job market weakens. The market is currently pricing a 65% chance of another rate cut in December as economic indicators continue to shift. Barkin concluded that the Fed's future actions will depend on business confidence and economic developments.