Fed Governors Waller and Bowman Oppose Rate Cuts, Both Cite Signs of Weakness in the Labor Market
According to a report by Jinse Finance, Federal Reserve Governors Waller and Bowman have expressed concerns that policymakers’ hesitation over rate cuts could cause unnecessary harm to the labor market. Both Waller and Bowman voted against the Fed’s decision this week to keep the benchmark interest rate unchanged for the fifth consecutive time. They favored a 25 basis point rate cut. In separate statements released on Friday, both explained their dissenting votes, emphasizing signs of weakness emerging in the labor market. Their views differ from those of Powell and other policymakers. Powell and others still believe the labor market remains generally robust and support a patient approach to adjusting rates. Waller stated, “I believe the current wait-and-see stance is overly cautious. In my view, it does not properly balance the risks to the economic outlook and could result in policy lagging behind changing conditions.” He pointed out that, given future data revisions and stagnating private sector job growth, downside risks to the labor market are increasing. Bowman said, “The vitality of the labor market is waning, and there are growing signs of fragility.”
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