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Analysts at TD Securities note that the Atlanta Fed President Raphael Bostic indicated he sees no need to adjust the policy rate and that chances for an interest rate hike or cut are equally likely.

Key Quotes

“His comments go hand-in-hand with Vice Chair Richard Clarida, who stated the US economy is operating at or close to the Fed’s dual mandate objectives.”

“These comments would suggest Fed officials are likely to maintain its policy stance unchanged for now, in contrary to market expectations of at least one rate hike this year. That said, St. Louis Fed President James Bullard noted that one of the conditions to lower rates, in his view, would be in a scenario where core inflation remains persistently below the Fed’s 2% target. Core inflation is currently at 1.55% y/y but we expect it to tick above 1.6% in the April report.”