Chicago Fed's Goolsbee Praises May's Inflation Report but Calls for More Data

Federal Reserve Bank of Chicago President Austan Goolsbee recently praised May's inflation report, describing it as "very good." However, he emphasized that the central bank needs to see several months of similar data before considering any changes to monetary policy.

During a fireside chat at the Iowa Farm Bureau Economic Summit in Ankeny, Iowa, Goolsbee highlighted that May's Consumer Price Index (CPI) was flat, which is a positive sign. If future reports continue this trend, it will boost the Federal Reserve's confidence in managing inflation. He noted that reaching a sustainable 2% inflation rate is crucial for determining whether interest rates can be normalized in the near to medium term.

Goolsbee stressed the importance of ongoing progress in inflation control, mentioning that he will be closely analyzing extensive data before deciding on any potential interest rate cuts.

In his remarks, Goolsbee also touched on other economic factors. He suggested that the U.S. dollar (DXY) might strengthen as European countries reduce borrowing costs. While a stronger dollar could affect the balance of exports and imports, it also has implications for employment and inflation.

Additionally, Goolsbee pointed out that credit delinquencies are rising but not to levels that would indicate a recession. He also expressed openness to discussing changes to the Fed's inflation target, but only after the current target is met.