Fed Board Member Christopher Waller assessed the potential impact of the conflict between Palestine and Israel on Fed policy. Waller believes that the tension in the Middle East will not have a direct impact on Fed policy.
Emphasizing the Fed’s commitment to achieving its inflation target, Waller expressed a “wait and see” approach regarding future interest rate increases. He also noted that the U.S. labor market has remained remarkably resilient despite Fed policy.
“The real economy appears to be in good shape, and things seem to be going well, but predicting the direct impact of the Palestine-Israel tension on Fed policy is difficult.”
Michelle Bowman: We Need to Tighten Monetary Policy
Fed Governor Michelle Bowman, on the other hand, argued that even though inflation is slowing, it remains above the 2% target, and she advocated for the need for the Fed to further tighten monetary policy to ensure price stability.
Bowman stated, “This indicates the necessity of raising interest rates further and maintaining a tight policy until the target is reached.” She also expressed her concern about inflation affecting the economy and emphasized the need for the Fed to take action to address it.