Federal Reserve Watch for Sept. 3: Musalem, Bostic See Current Monetary Policy Only Modestly or Marginally Restrictive

02:54 PM EDT, 09/03/2025 (MT Newswires) -- St. Louis Fed President Alberto Musalem (voter) said that monetary policy is "modestly restrictive" and is appropriate given the still strong labor market and elevated inflation, but cautioned that there is considerable uncertainty to outlook, particularly downside risks to the employment mandate.

Atlanta Fed President Raphael Bostic (nonvoter) said that he views the current stance of monetary policy as only "marginally restrictive" and that he sees only one rate reduction to be needed in 2025 but said that he is open to adjusting his outlook depending on the incoming data.

Recent comments of note:

(Aug. 28) Fed Governor Christopher Waller repeated that he would be in favor of a 25-basis point rate reduction at the September FOMC meeting and that he believes that further rate reductions may be needed in the near term due to a weakening labor market.

(Aug. 27) New York Fed President John Williams (voter), in an interview with CNBC, highlighted the need for central bank independence to maintain low inflation and economic stability. Williams said that the economy remains strong and that he expects the FOMC to lower the target for the federal funds rate over time but did not comment on whether the first rate cut could come at the Sept. 16-17 meeting, instead saying that he is open to a rate reduction when the data allow.

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