“This uptick of inflation that we’ve been seeing, coupled with the payroll jobs numbers deteriorating, have put the central bank in a bit of a sticky spot where you’re getting deterioration of both sides of the mandate at the same time,” Goolsbee said.
The Federal Open Market Committee (FOMC) voted in September to lower its benchmark rate by a quarter percentage point, with two more cuts potentially on the table before year-end.
Goolsbee, a voting member this year, acknowledged that while the labor market data “continues to point to a pretty stable labor market,” the path forward should be gradual.
“I believe that the underlying economy can afford rates to come down over time, in a gradual basis, a fair amount from where they are now,” he said.
The odds of a Federal Reserve rate cut in October have hit 100%, according to the CME FedWatch tool, as mounting economic headwinds and political turmoil sharpen the focus on monetary policy.https://t.co/hjoRJ4CNoM
— Mortgage Professional America Magazine (@MPAMagazineUS) October 2, 2025
Fed officials remain divided on the pace of further easing. Dallas Fed President Lorie Logan, speaking separately at the University of Texas at Austin, echoed Goolsbee’s caution.