Bostic Signals Labor Market Weakness, Expects 2025 Rate Cuts
Atlanta Federal Reserve President Raphael Bostic on Thursday suggested that the U.S. labor market is showing increasing signs of softening, offering investors a slightly dovish outlook amid fading hopes for Fed rate cuts this year.
“The job market remains stable, but evidence of a slowdown is building,” Bostic wrote in an essay. He pointed out that job seekers are finding it more difficult to secure employment compared to a few months ago, with job-finding probabilities now lower than pre-pandemic levels. “As a result, the average unemployment duration is about three weeks longer than it was last August,” he added.
Bostic also expects inflation to continue cooling as slower rent growth, reflected in data from Zillow and Redfin, feeds into official price measures.
He described the Fed’s current policy stance as “moderately restrictive” and reiterated his expectation for two rate cuts in 2025.
Following his remarks, the U.S. 10-year Treasury yield and the dollar dipped slightly, while Bitcoin (BTC) climbed 0.5% to $97,600.
