In an interview on CNBC's 'Squawk Box', former Federal Reserve Vice Chairman Roger Ferguson discussed the current state of the economy and potential interest rate decisions.
Economic Conditions and Fed Policy
Ferguson emphasized that under current economic conditions, the Fed is operating in a 'wait-and-see' mode and needs to be patient in its decision-making. He noted that a rate cut is not expected this week.
Expectations for Rate Cuts
According to Ferguson, 'The Fed will not cut interest rates at this meeting or even the next one. They hope inflation will decline further, but will remain cautious.' He added that this situation may disappoint some segments of the market.
Geopolitical Risks and Their Impact
Ferguson also pointed out that the rise in oil prices has not yet been reflected in core inflation, but this could change. With respect to risks from the Gulf, Ferguson warned that the Fed needs to exercise caution in its decisions.
Therefore, Roger Ferguson highlights the necessity of the Fed's cautious approach in the face of uncertainty and a range of factors influencing economic policy.
