Fedspeak Monitor 7/21/24

Another week of Fedspeak hearing from the dovish side of the Committee, who are mostly pushing back on July (except Goolsbee). Most forcefully amongst these is Daly, who focused most of her monetary policy remarks on the risks to cutting too early ("We have to balance the cost of acting fast and being wrong.") and actively rejected taking preemption seriously ("Preemptive action when urgency isn't required is actually where you make mistakes"). Williams too seems happy to wait until September, saying there are good reasons to wait (given the two months of inflation data they'll get in between those meetings).

Waller also is in no hurry, saying the most likely scenario is that inflation progress is bumpy, necessitating more patience on rate cuts. Despite that, Waller—who delivered a very hawkish set of remarks earlier this year—has similarly shifted his tone alongside Powell and the more dovish side of the committee. He's talking more about the risks to the unemployment side of the mandate and now thinks "the evidence is mounting that the first quarter inflation data may have been an aberration." He took a victory lap in the Figura-Waller v. Blanchard-Domash-Summers debate, so he's taking the convex Beveridge Curve—and its implications for further unemployment risk—seriously.