According to TechFlow, on August 5, according to Jinshi Data, Fed Chairman Goolsbee emphasized in a recent speech that the Fed has always been in a tightening state, and the current data does not show signs of overheating. He pointed out that strict monetary policy is only necessary when there is a concern about overheating of the economy. Goolsbee mentioned that the July employment report is only "a number" and the Fed's responsibility should not be to respond to a single month's data.
He said the Fed could wait for more economic data before its September meeting to make a fuller assessment. If the job market cools too much, it could force the Fed to respond more forcefully. He emphasized that adjustments should be made based on overall economic conditions. Although inflation has declined significantly and employment conditions are relatively good, the Fed still needs to pay attention to potential weakness in the job market.
Goolsbee also mentioned that the current level of real interest rate constraints has reached the highest level in decades, and future policy adjustments will depend on changes in the economic situation. He pointed out that the global economic situation is complex and needs to be handled with caution.
In addition, Goolsbee mentioned that although economic growth continues to maintain a stable level, there are still some warning indicators, such as corporate defaults. He said that the manufacturing industry may be weak due to the impact of the epidemic, but the GDP data is slightly stronger than expected. He concluded that the employment data was lower than expected, but it did not show signs of a recession yet, and the Fed needs to be forward-looking in its decision-making.
