Federal Reserve Governor Quarles: November inflation report "encouraging" Rate cut still needs more data support

Chicago Federal Reserve President Gulsbee affirmed the November inflation report, stating that it shows that price pressures are gradually easing, and contains "many positive signals". "While this is just a single month's data, we should not overreact to monthly fluctuations, but the data for November is indeed noteworthy," Gulsbee said in an interview on Thursday. At the Federal Reserve's November policy meeting, most members voted to cut interest rates, but Gulsbee dissented. He was more inclined to keep rates unchanged, citing concerns that inflation levels are still higher than the Fed's target of 2%. Gulsbee further stated that more economic data is needed to confirm that inflation has substantially declined to a level that warrants rate cuts. Data released earlier on Thursday by the US Bureau of Labor Statistics showed that core inflation in the US has fallen to its lowest level since early 2021. As of November, the overall Consumer Price Index (CPI) in the US rose by 2.7% year-on-year, narrowing from the 3% increase in September. However, economists caution that the accuracy of these data may have been compromised by the government shutdown. Gulsbee emphasized that if the labor market remains stable in the future, and inflation continues to move closer to the Fed's target, he will maintain an open stance towards "moderate" rate cuts.