Fed’s Goolsbee predicts a gradual reduction in policy rates over the next twelve to eighteen months

(Reuters) – Chicago Federal Reserve Bank Austan Goolsbee said on Thursday he sees a series of rate cuts over the next year and a half, noting that inflation is now close to the Fed’s 2% target and the economy is operating at about full capacity. employment, and the Fed’s goal is to freeze these conditions. “Over a period of 12 to 18 months, I think we will gradually, whatever word you want to use, get to a stable situation” in terms of the policy rate, Goolsbee said in a CNBC interview.

He noted that there is broad agreement among policymakers that interest rates should fall by a “reasonable amount” over that period. In the short term, he said, there are likely to be more meetings where policy decisions will be made in the nick of time, like last month, as central bankers sort through sometimes conflicting data.

(Reporting by Ann Saphir)