00:00we will get another CPI report for February on March 11th, a week before the next FOMC meeting.
00:06And along with the February labor report, it will be an important basis for my judgment
00:12on the proper stance of monetary policy. Assuming underlying inflation continues to signal we are
00:20close to our 2% goal, the key to setting appropriate policy will be my view of the labor
00:27market. If the labor market data for February are consistent with the stronger job creation
00:33and low unemployment rate initially reported in January, indicating that downside risks to the
00:39labor market have diminished, it may be appropriate to hold the FOMC's policy rate at current levels
00:46and watch for continued progress on inflation and strengthen the labor market. But if the good
00:53labor market news of January is revised, revised away or evaporates in February, it would support
01:00my position at the FOMC's last meeting that a 25 basis point reduction in the policy rate was
01:06appropriate and that such a cut should be made at the March meeting.
01:13As things stand today, I rate these two possible outcomes as close to a coin flip.
Comments