Superintendent Michelle Bowman, vice-chairman of the Federal Reserve, said on Saturday that she supports her longstanding view that the latest Softjobs report adds to concerns about labor market health and is likely to require three interest cuts this year.
Bowman was one of two governors who opposed the Fed’s decision last month and would maintain short-term interest rates between 4.25% and 4.50%, the level he has held since December.
While many Fed officials have been reluctant to push for interest rate cuts due to concerns that tariffs from the Trump administration could slow progress towards the Fed’s 2% target, recent comments from several policymakers have suggested increased support for the cuts.
Talk to the Kansas Bankers Association, as mentioned in Reuters ReportBowman said his performance at the last meeting was a way to prevent more damage to the labor market and the possibility of slowing economic growth. Her comments on Saturday focused more on the weakness of the labour market than previous explanations following last month’s policy vote.
According to Cryptopolitan, Bowman already had it Showed her openness to supporting the July fee Reduction when inflation is low
Unemployment rates rise as employment grows slower
The Labor Bureau reported on Friday that the unemployment rate rose to 4.2%. This was explained by Bowman “rounding to 4.3%.” The same report also revised historical figures, indicating that employment growth has slowed to 35,000 a month over the past three months.
“This is well below the moderate pace we saw earlier this year due to a significant softening of labor demand,” Bowman said. She added that her own forecasts since last December include three interest rate cuts this year, with the latest employment data strengthening that outlook.
As emphasized by CryptopolitanBowman and Waller’s previous demands for policy easing had already changed market expectations.
The Fed has three policy meetings remaining in September, October and December.
Economists generally see around 100,000 jobs a month when they are sufficient to stabilize the labor market. That figure could be lower due to a decline in immigration since President Donald Trump began his second term in January.
Bowman’s clear support for rate cuts comes as Trump repeatedly pushes central banks to ease policies.
A search for a replacement for Federal Reserve Chairman Jerome Powell, which ended in May, is already underway. What is considered is Gov. Christopher Waller, like Bowman, who opposed from last month’s decision. Bowman said she began advocating for July interest rate cuts during the Fed’s June meeting.
Meanwhile, Trump claims he was “equipped” with the latest employment figures and rejected the Bureau of Labor Statistics commissioner shortly after the report was released.
Policies expected to offset the impact of tariffs
Bowman often notes that large revisions to employment data rely too much on a single report. However, on Saturday, she noted that the latest information on economic growth, employment and inflation shows higher risks to one of the Fed’s two main goals: employment.
She also said she is confident that recent inflation numbers will not cause permanent price increases. Without a rise in tariff-related commodity prices, the underlying inflation is “far closer” to the Fed’s 2% target than the June official 2.8% reading based on the core personal consumption expenditure price index over a 12-month period.
Bowman said Trump’s policies, including tax cuts and deregulation, are likely to balance the slowdown in the economy or price rise caused by import tariffs.
She said the likelihood of prices rising rapidly has declined as housing demand could possibly be the lowest point as the financial crisis and the labor market put no upward pressure on inflation.
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