Fed's Kugler advocates for steady policy rate at 2025 Miami Economic Forum
Investing.com -- Federal Reserve board member Adriana Kugler spoke today at the 2025 Miami Economic Forum, sharing her views on the current state of the labor market and the Federal Reserve's monetary policy.
Kugler described the economy as resilient and the labor market as stable. She stated that the current stability in the labor market provides a window for decision-making. Kugler also commented on the inflation rate, stating that it has remained steady and firmed up.
In her speech, Kugler advocated for maintaining the current policy rate. She said it would be wise to keep the policy rate steady for a while, given the inflation rate is above 2%, the economy is solid, and there are uncertainties to consider.
Kugler also expressed the need for a continued slowdown in inflation to feel comfortable reducing rates. She expressed concern over the lack of assistance with goods inflation but noted that housing inflation decreased in the fourth quarter.
Kugler also touched on the neutral rate, stating that it has risen somewhat, but not as much as some might believe. She clarified that we have not yet reached the neutral rate. She expressed strong support for keeping the inflation target at 2%.
As for the rest of the Federal Reserve's policy framework, Kugler anticipates a lot of discussion, papers, and debate. She emphasized that the next framework needs to incorporate lessons from the pandemic and post-pandemic period.
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