Patrick Harker, Interview: Reuters (transcript not available, print only)

Inflation

“What is driving our rate increases right now is inflation, and we are starting to see signs, early signs that inflation is starting to move down.”

25bps Rate Hike

“At this point, we can go at a pace of 25 (basis-point rate hikes) and get inflation under control without doing undue damage to the labor market.”

Rate Cuts

But after that, with inflation on track to ease and head back to 2% over the next couple of years, Harker said the door would open to the possibility of the Fed cutting rates at some point, simply to keep monetary policy from becoming more restrictive of economic activity.  “I don’t think that’ll happen this year,” but in 2024 “we could start to see” movement downward in the federal funds rate that will likely be gradual in nature, Harker said.