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Investing.com -- Federal Reserve Bank of Richmond President Thomas Barkin said on Friday there is no urgency to cut interest rates as inflation risks remain unresolved and the U.S. economy continues to show resilience.
"I don’t think the data gives us any rush to cut...I am very conscious that we’ve not been at our inflation target for four years," Barkin said in an interview with Reuters, highlighting that businesses in his district anticipate price increases later this year when new tariffs take effect.
The Fed maintained its policy rate in the 4.25% to 4.5% range during this week’s meeting. Barkin expressed comfort with the current position, noting that "core inflation is still over target" and that a "modestly restrictive" stance helps address this issue.
Barkin pointed to several factors supporting a patient approach. The unemployment rate remains low at 4.2%, and companies don’t appear poised for major layoffs that would threaten the Fed’s maximum employment goal. Consumer spending is "holding up fine" without being either "frothy" or "weak."
"Nothing is burning on either side such that it suggests there’s a rush to act," he said, adding that he’s "not in a mood to ignore a spike in inflation were it to come."
The Richmond Fed president’s remarks come amid heightened uncertainty surrounding U.S. trade policy. The Trump administration has set July 9 as a deadline for other nations to reach trade agreements with the U.S. or face potentially high taxes on their goods.
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