By Michael S. Derby
NEW YORK Federal Reserve Bank of Richmond President Thomas Barkin said on Thursday that it is not yet clear to him what the central bank will need to do on monetary policy into the end of the year.
When it comes to the prospect of another interest rate rise, it is "too early for me to know. I think there are a wide variety of possible outcomes" facing the economy, and because of that uncertainty, it's good for the Fed to take some time and see how the data plays out, Barkin said, speaking on Bloomberg TV.
Barkin said in the interview that he expects growth will slow from the pace seen over the start of the year, but he expects the expansion will continue amid some not surprising softening in consumer spending among lower and middle income households.
Barkin acknowledged a possible government shutdown would complicate the Fed's ability to get a read on the economy. House Republicans have been unable to agree on a spending bill needed to keep the government in operation, which threatens the collection and publication of economic data.
"It would be hard to figure out what's actually happening in the economy without the jobs data, which is the best information on the labor market," Barkin said.
But he noted the experience of the pandemic has driven the Fed to look for alternative real time data such as credit card spending numbers, which reduce the odds of the central bank flying totally blind.
"We'll do our best. You take the environment as it is and you do your best to figure out what's going on," Barkin said.
(Reporting by Michael S. Derby; Editing by Leslie Adler and Daniel Wallis)
