Chicago Federal Reserve President Austan Goolsbee on Monday vowed that the central bank would react to signs of weakness in the economy and indicated that interest rates could be too restrictive now.
Asked whether weakening in the labor market and manufacturing sector could prompt a response from the Fed, Goolsbee did not commit to a specific course of action but said it doesn’t make sense to keep a “restrictive” policy stance if the economy is weakening. He also declined comment on whether the Fed would institute an emergency intermeeting cut.
“The Fed’s job is very straightforward, maximize employment, stabilize prices and maintain financial stability. That’s what we’re going to do,” the central bank official said during an interview on CNBC’s “Squawk Box” program. “We’re forward-looking about it. So if the conditions collectively start coming in like that on the through line, there’s deterioration on any of those parts, we’re going to fix it.”
The interview occurred with markets in turmoil.
