In an interview with Reuters on Thursday, Federal Reserve Bank of Philadelphia President Patrick Harker expressed his support for a potential interest rate cut in September, provided the economic data aligns with his expectations.
Discussing the possibility of reducing the cost of short-term borrowing, Harker told the publication, “For me, barring any surprise in the data we’ll get between now and then, I think we need to start this process” of lowering rates.
He made these remarks during an interview with Reuters while attending the Kansas City Fed’s annual research conference in Jackson Hole, Wyoming.
Harker emphasized that the size of any single rate cut is less critical than the overall strategy of gradual reductions, telling Reuters that he thinks “a slow, methodical approach down is the right way to go.”
He also highlighted that his business contacts prefer a predictable and steady approach to rate cuts rather than a repeat of the rapid increases that were implemented starting in the spring of 2022.
Harker’s comments come in the wake of the release of meeting minutes from the Federal Reserve’s July meeting, which indicated that the “vast majority” of policymakers are inclined to support a rate cut in September if the economic data meets expectations.
His statements were made just ahead of highly anticipated remarks by Fed Chairman Jerome Powell at the same conference, Reuters reported.