Survey of Business Uncertainty: Views on Monetary Policy
Atlanta Fed president Raphael Bostic explains how survey results and feedback from respondents are important tools in recognizing and reacting to economic trends.

Transcript

Dave Altig: I said I would give you an opportunity to talk a little bit about your view of monetary policy going forward. Are there any salient points you want to make?

Raphael Bostic: I'll go back to the surveys and the feedback that I've gotten. About a year ago, we had to do what the dot plots, we call it the summary of economic projections. I don't do acronyms. If you hang around me long enough, you'll know that as well. As part of that, they ask when are you going to move your interest rates and how are you going to move them over time? From the survey responses I was getting from your survey, from this survey and others, it was clear that the economy was coming back stronger than anyone had anticipated going in and that made me comfortable saying 2022 is going to be the year we're going to do our liftoff. That continued through most of last year and caused me to say, "OK, we're going to have to do more and we're probably going to have to do it earlier than we had ever expected." I think that's really come to pass.

At the last SEP, I was at a place where I thought we would move three times this year, assuming that inflation did start to come under control and that the labor market momentum continued as well. We'll have to see where that is. Inflation has continually surprised to the upside in terms of where our models were a year ago, and if that continues then we might have to do more, but I'm really going to, I said those two words before, I'll say it again, observe and then adapt. We're going to get a couple inflation readings in the next couple of weeks. If they come in stronger, as in inflation being higher than what I'm expecting, then I'll be open to moving maybe four times if necessary and we'll see how that goes over time.

One other thing that I've been trying to say very often, as often as possible and try to say as clearly as possible, is that I also don't have any preconceived notions about the nature of the trajectory. Lots of folks have been asking, are you only going to move every other meeting? Is every move only going to be 25 basis points? All those sorts of things. For me, I really am approaching this, everything's on the table. If the data points to us needing to act more strongly, I'll be comfortable with that. If it points to us needing to act more persistently, I'll be comfortable with that as well. I think everybody just needs to just watch and try to interpret and get a sense of what's going on.

Let me say one other thing on this, which is for all of you survey respondents, your feedback is actually very important. I tell people all the time, if you're seeing things that you're not seeing covered in the news or that you think is important or useful, they can give us insights, you should go and do that. Please do reach out to Nick, or Brent, or Dave and let us know those things because we're trying to be as real-time informed as possible and that can really help us get to a good place.