"Eagles and doves" fly together! Federal Reserve officials send conflicting signals on monetary policy prospects.

On Thursday, Federal Reserve officials made multiple speeches on the outlook for monetary policy, releasing different signals about the current monetary policy direction. Cleveland Fed President Hamaek said that current inflation is still "too high" and the risks posed by the economy are greater than the slowing labor market. She emphasized that monetary policy should continue to put pressure on inflation, and noted that the current interest rate level is "almost non-restrictive," suggesting that further rate cuts may be premature. Hamaek predicted that it would take at least one to two years after 2026 for U.S. inflation to fall to the Fed's 2% target, meaning that the Fed will have failed to achieve price stability goals for nearly a decade. She also revealed that businesses in her district are facing rising cost pressures and plan to pass on prices to consumers. Meanwhile, New York Fed President Williams made a relatively dovish speech. He said that market estimates of the "neutral rate" may be too high, and if this proves to be true, the Fed still has room to continue cutting rates without weakening its efforts to curb inflation. Williams did not explicitly state whether he supports a rate cut in December, but emphasized the importance of central bank independence in maintaining price stability, pointing out that historically, central banks lacking independence have often led to high inflation and economic imbalance. Fed Governor Milan explicitly stated that he expects the Fed to cut rates again in December, despite some non-voting officials may hold different opinions. He pointed out that the policy stance ultimately depends on the "voting structure" rather than the "distribution of views," so even if there are obstacles, a rate cut may still be the majority decision. Milan said: "Unless something unexpected happens, I expect we will cut rates in December." However, Chicago Fed President Goolsbee expressed concerns about the path of rate cuts. He said that due to the government shutdown, official inflation data is temporarily missing, and policymakers may not be able to promptly identify price risks, making him increasingly worried about continuing to cut rates. Goolsbee emphasized that adopting loose policies in the absence of critical information poses risks. Currently, the U.S. labor market shows signs of cooling down, but still remains within a "generally healthy" range. Hamaek expects the unemployment rate to only slightly exceed the long-term equilibrium level by early 2026, indicating that inflation should be prioritized over excessive concerns about employment. Failure to curb inflation in time could lead to long-term high prices being solidified in the economy, resulting in greater costs.