Bloomberg Talks Eric Rosengren Talks Fed
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Jan 13, 2026 Eric Rosengren, former president of the Federal Reserve Bank of Boston, shares insights on the delicate balance of Fed independence and market reactions. He warns that actions from the administration may undermine confidence in the Fed, complicating potential interest rate cuts. Despite short-term rate projections, he predicts long-term rates could rise due to inflation concerns. His discussion on political pressures influencing Fed appointments highlights the crucial relationship between independence and fiscal policy.
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Inflation Still Keeps Fed Cautious
- Inflation remains above target with CPI at 2.7% and PCE rising, reducing confidence that the Fed will return to 2% quickly.
- Eric Rosengren sees weaker conditions for easing now than a quarter ago given persistent inflation metrics.
Slow Labor Growth Yet Possible Stronger GDP
- Labor market growth is modest with about 50,000 jobs monthly, partly because immigration has slowed labor force expansion.
- Rosengren expects fiscal stimulus and investment credits could boost GDP next year, reducing immediate pressure to cut rates.
People, Not Just Data, Shape Policy
- Fed decisions depend on who sits on the FOMC and who becomes chair, not just on headline data alone.
- Rosengren warns a new chair must build credibility to convince a majority before cutting rates.