Atlanta Fed President Bostic expects job cuts but says there’s a really good chance of getting to 2% inflation without killing the economy

Federal Reserve Bank President and Chief Executive Officer of Atlanta Raphael W. Bostic speaks at an event of the European Financial Forum in Dublin, Ireland on February 13, 2019.

Clodagh Kilcoyne | Reuters

Raphael Bostic, the president of the Federal Reserve Bank of Atlanta, appeared on CBS’ “Face The Nation” Sunday morning with an ongoing commitment to the 2% inflation target and a cautiously optimistic view of the path to get there.

The country’s central bank on Wednesday raised its target federal funds rate by 75 basis points to between 3 and 3 1/4. Bostic believes the Federal Reserve can achieve its target of 2% inflation without seriously harming the economy.

“I really think that at the Federal Reserve we will do everything we can to avoid deep, deep pain.” Bostic told “Face the Nation.”

The most recent report clocked inflation at 8.3% last year. The Fed is aiming to temper demand in the economy so that prices can stabilize, but some fear the strict policy could lead to further economic turmoil.

Bostic acknowledged that there will likely be job losses as a result of the Fed’s actions. However, compared to previous Fed tightening, Bostic believes that “there is a very good chance that if we have job losses it will be smaller than what we’ve seen in other situations,” he said in “Face the Nation.”

Bostic sees “positive momentum” in the economy despite two consecutive quarters of negative GDP growth, a meaning used by some to denote a recession.

“We’re still creating a lot of jobs on a monthly basis. And so I actually think the economy is able to absorb our actions to some degree,” Bostic said, noting “significant job growth” in his bank’s hometown, Atlanta. . “My expectation is that as we move forward and we get inflation more under control.”

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