Fed's Jefferson: Inflation Focus as Labor Market Resilient

Fed Vice Chair Jefferson: Inflation Focus Amid Resilient Labor Market

Federal Reserve Vice Chair Philip Jefferson said on Thursday it was appropriate to focus on returning inflation to the central bank's 2% target given the U.S. labour market has been 'very resilient' to the current energy shock.

Monetary Policy and Labor Market

Speaking at a conference hosted by the BOJ in Tokyo, Jefferson stated, 'When I'm thinking about my policy decision meeting by meeting, I'm absolutely focused on price stability, but by mandate I also need to keep in mind what's happening in the labour market.' He noted the U.S. labour market's resilience and said it seems appropriate to focus on returning inflation to 2%.

Energy Shock and Growth

Jefferson acknowledged rising energy and gasoline prices impact everyday people, but said the U.S. economy continues to grow despite the energy shock, partly due to expanding AI investment. 'The energy shock is a headwind for growth, but we are still having growth during this episode,' he added.

Upcoming Meeting

Regarding the next Federal Open Market Committee meeting on June 16-17, Jefferson said, 'I have not prejudged the next meeting and look forward to engaging with my colleagues about the policy necessary to best achieve our dual-mandate goals.'