Officials of the U.S. Federal Reserve are adopting a 'neutral' policy stance, noting strong economic performance and waiting for Donald Trump's policies to become clearer. Federal Reserve Governor Michelle W. Bowman said in a speech in California on January 9: 'I expect that in the coming months we will be able to clarify the policies of the incoming administration and the continuation of inflationary pressures in 2024.'
Bowman's remarks, along with those of Kansas City Fed President Jeff Schmid on the same day, indicate that due to the strong performance of the U.S. economy before the end of 2024, and with inflation remaining 'above the 2% target', there may be no need for further rate cuts. Schmid said: 'I believe we are nearing a point where the economy does not need to be restricted or supported, and the policy should be neutral.'