On Thursday’s broadcast of CNBC’s “Squawk on the Street,” Philadelphia Federal Reserve Bank President Patrick Harker stated that by this time next year, inflation will be around 3% and will move “slowly” to the 2% target level “in 2025.”
CNBC Senior Economics Reporter Steve Liesman asked, “I’d like to get your thoughts on, this time next year, where’s the U.S. economy, where is inflation? How are we doing this time next year, do you think?”
Harker answered, “So, I think we have inflation at or slightly near 3%, again, moving slowly to 2 in 2025. We see it moving toward trend growth in GDP and unemployment ticking up, again, in the 4-ish range, but not significantly more than that.”
Liesman then asked, “I left out a question and you didn’t answer it voluntarily, which is, what’s the funds rate doing, at that time? Are you into cuts at this time next year?”
Harker responded, “So, at this point, I see us staying steady throughout the rest of this year. Then we’ll see all the data evolve. If we see inflation coming down quicker than we expect — and again, this is what I’m hearing from the soft data I’m getting from my contacts — then we might cut sooner rather than later. But I think we have to let that play out.”
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