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Raphael Bostic, the president of the Federal Reserve Bank of Atlanta, appeared on CBS’ “Face The Nation” Sunday morning with a continued commitment to the 2% inflation target and a cautiously optimistic outlook on the path to get there.
The nation’s central bank hiked the targeted federal funds rate by 75 basis points to between 3 and 3 1/4 Wednesday. Bostic believes that the Federal Reserve can achieve its goal of 2% inflation without severely damaging the economy.
“I do think that we’re going to do all that we can at the Federal Reserve to avoid deep, deep pain.” Bostic told “Face the Nation.”
The most recent report clocked inflation at 8.3% through the past year. The Fed is aiming to temper demand in the economy so prices can stabilize, but some fear that the strict policies might initiate further economic turmoil.
Bostic recognized that there will likely be job losses as a result of the Fed’s actions. However, compared to prior Fed tightening, Bostic believes that “there is a really good chance that if we have job losses it will be smaller than what we’ve seen in other situations,” he said on “Face the Nation.”
Bostic sees “positive momentum” in the economy despite two consecutive quarters of negative GDP growth, a signifier used by some to identify a recession.
“We’re still creating lots of jobs on a monthly basis. And so I actually think that there is some ability for the economy to absorb our actions,” Bostic said, noting “considerable job growth” in his bank’s hometown of Atlanta. “My expectation is that as we move along and we start to get inflation more under control.”