MNI BRIEF: Fed's Harker Sees Inflation Heading Steadily To 2%

Philadelphia Fed President Patrick Harker said Thursday he expects inflation to fall steadily toward 2% and labor market tightness to continue to ease, suggesting heightened chances of a soft landing.

"Now, as the curtain rises on 2024, inflation is roughly half of what it was at this time last year, and my expectation remains that inflation will continue to ebb as we head — slowly yet surely — toward our 2% annual target," he said in a blog. "Along with this, labor market tightness continues to ease, GDP growth continues to exceed expectations, and the possibility of a recession seems less likely."

The numbers clearly show this progress, he added. "As always, hard data are at the core of how I consider monetary policy. But I will also continue to be guided equally by soft data," Harker said. (See: MNI INTERVIEW: Fed Might Not Cut At All In '24-Ex-Fed Economist)