Fed’s Bostic: Fed within “shouting distance” of neutral rate, which is where policy should head

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In his prepared remarks, Atlanta Fed President Raphael Bostic argued that the Fed was within “shouting distance” of a neutral rate and added that this was the for the policy to head.

Key quotes (via Reuters)

  •  “A lot to like” about current state of economy, though expects growth to slow.
  • Does not expect surge in investment, and likely cooling of recent “torrid” pace of consumer spending.
  • Does not address risk of yield curve inversion.
  • Hard to judge risk of overheating in ‘real time,’ but feels loss of control of inflation is not something Fed should risk.
  • Risk management should consider that unemployment below normal for an extended period is a ‘symptom’ of overheating.
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