Search
 

‘Rates Will Be a Lot Lower’ in 12 to 18 Months

Chicago Federal Reserve President Austan Goolsbee says that although the Fed will take its time reducing interest rates, the end result will be much lower rates if inflation stays near the Fed’s target.

By Catarina Saraiva and Laura Curtis | November 18, 2024 at 12:43 AM
Chicago Fed President Austan Goolsbee

Federal Reserve Bank of Chicago President Austan Goolsbee said that as long as inflation continues down toward the central bank’s 2 percent goal, interest rates will be “a lot” lower in 12 to 18 months. But Goolsbee agrees with Fed Chair Jerome Powell that policymakers are not in a hurry to lower borrowing costs.

“As long we keep making progress toward the 2 percent inflation goal, over the next 12 to 18 months rates will be a lot lower than where they are now,” Goolsbee said on CNBC Friday. The Chicago Fed chief said it makes sense to slow rate cuts at some point amid uncertainty over where the neutral rate is—that’s the level where policy neither stimulates nor restrains the economy. “If there’s disagreement of what’s the neutral rate, it does make sense at some point to start slowing how rapidly we’re getting there,” he said. Goolsbee added that interest rates remain restrictive, so there’s still room to cut borrowing costs to a more neutral level.

Complete your profile to continue reading and get FREE access to Treasury & Risk, part of your ALM digital membership.

Your access to unlimited Treasury & Risk content isn’t changing.
Once you are an ALM digital member, you’ll receive:

  • Critical Treasury & Risk information including in-depth analysis of treasury and finance best practices, case studies with corporate innovators, informative newsletters, educational webcasts and videos, and resources from industry leaders.
  • Exclusive discounts on ALM and Treasury & Risk events.
  • Access to other award-winning ALM websites including PropertyCasualty360.com and Law.com.

Already have an account?

NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

Treasury & Risk

Join Treasury & Risk

Don’t miss crucial treasury and finance news along with in-depth analysis and insights you need to make informed treasury decisions. Join Treasury & Risk now!

  • Free unlimited access to Treasury & Risk including case studies with corporate innovators, informative newsletters, educational webcasts, and resources from industry leaders.
  • Exclusive discounts on ALM and Treasury & Risk events.
  • Access to other award-winning ALM publications including PropertyCasualty360.com and Law.com.

Already have an account? Sign In Now
Join Treasury & Risk

Copyright © 2024 ALM Global, LLC. All Rights Reserved.