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Fed's Bostic, Evans back rate rises with dovish overtones

Published 04/07/2022, 03:39 PM
Updated 04/07/2022, 04:36 PM
© Reuters. FILE PHOTO: Chicago Federal Reserve Bank President Charles Evans looks on during the Global Interdependence Center Members Delegation Event in Mexico City, Mexico, February 27, 2020. REUTERS/Edgard Garrido/File Photo

(Reuters) -As expectations rise that the U.S. Federal Reserve will step up its efforts to contain inflation with bigger interest rate hikes, Chicago Fed President Charles Evans and Atlanta Fed President Raphael Bostic on Thursday provided a somewhat dovish counterpoint.

"It's time that we get off of our emergency stance -- I think it's really appropriate that we move our policy closer to a neutral position -- but I think we need to do it in a measured way," Bostic told a Chicago Fed virtual conference on economic mobility.

Evans said: "I'm optimistic that we can get to neutral, look around, and find that we're not necessarily that far from where we need to go."

The Fed is widely expected to raise rates by a bigger-than-usual half-a-percentage point next month and begin paring its massive balance sheet as it steps up a battle against inflation now running at more than three times the Fed's 2% goal.

© Reuters. FILE PHOTO: Chicago Federal Reserve Bank President Charles Evans looks on during the Global Interdependence Center Members Delegation Event in Mexico City, Mexico, February 27, 2020. REUTERS/Edgard Garrido/File Photo

Both Evans and Bostic have said they support the Fed's plans to tighten policy, and both have previously said they would be open to a 50 basis-point move if needed.

But their voices calling for more moderation stand in contrast to those on the Fed's more hawkish wing, including St. Louis Fed President James Bullard who earlier on Thursday called for a rate-hike path this year that would require half-point hikes at the rest of the Fed's 2022 meetings.

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