By Mark DeCambre
Fed Gov. Bowman warns jobs market is weakening and urges faster action ahead of September Fed meeting.
Fed Gov. Michelle Bowman is breaking ranks with Fed Chairman Jerome Powell and the rest of the central bank.
Fed Gov. Michelle Bowman is doubling down on her call to cut interest rates, urging the central bank to move faster to protect what she sees as a weakening jobs market.
“Taking action at last week’s meeting would have proactively hedged against the risk of a further erosion in labor market conditions and a further weakening in economic activity,” Bowman said Saturday in a speech at a bankers’ conference in Colorado Springs, Colo.
Her remarks, delivered just over a week after she and Fed. Gov. Christopher Waller dissented from the Fed’s decision to hold rates steady in late July, add urgency to her push. That dissent was the first time in 32 years that two governors opposed the majority decision.
Once a firm opponent of lowering rates for fear of locking in high inflation, Bowman now says the greater risk is a faltering labor picture in the U.S. Over the weekend, she signaled she would support moving more quickly-and perhaps more decisively-to cut rates if labor data takes another hit before the Fed’s September meeting.
“I see the risk that a delay in taking action could result in a deterioration in the labor market and a further slowing in economic growth,” she said on Saturday.
For borrowers and investors, the question may now be less about if rates will be cut next month and more about the pace of rate reductions to follow-a shift that could ripple from mortgages to credit cards and across the broader economy. Futures markets overwhelmingly expect the first move to be a quarter-point cut from current levels at a range of 4.25%-4.50%.
-Mark DeCambre
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08-09-25 1431ET
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