An interesting shift in Rezerwy Federalnej rhetoric. Harker from the Philadelphia Fed just signaled that if inflation truly begins to decline, further interest rate cuts could be on the table. But — and here’s the catch — don’t expect quick moves.

It was presented as follows: the current rate level of 3.5%-3.75% is considered "somewhat restrictive," meaning it’s actually slowing down the economy and creating room for maneuver. Harker noted that he views the possibility of easing price pressures with cautious optimism in the coming months. This is important because it indicates that Rezerwy Federalnej no longer sees as much inflation threat as before.

However — and this is worth noting — Harker explicitly said he would like to see more evidence first. He mentioned a "moderate adjustment" of federal rates "later this year" if conditions remain favorable. The labor market? Signals are mixed. There’s no collapse, but there are no spectacular gains either. They’re waiting for more data.

This means rate cuts could happen, but they won’t be impulsive. Rezerwy Federalnej will monitor inflation and the economy step by step. For those waiting for a change in monetary policy, it’s more of a "wait and see" than an "it’s already starting."