For immediate release

Contact: Daneil Mazone, Media Relations

Philadelphia, PA — Federal Reserve Bank of Philadelphia President and CEO Patrick Harker today gave his initial economic outlook of 2024, telling an audience in Newark, Delaware, that while he believes the time is near for the Federal Open Market Committee to lower the policy interest rate, it has not yet arrived.

Speaking at the annual Economic Forecast forum sponsored by the Lyons Companies and the University of Delaware’s Center for Economic Education and Entrepreneurship, Harker highlighted the most recent Personal Consumption Expenditure (PCE) price index report, which pegged year-over-year headline inflation in January at 3.1 percent with a six-month trend below the Fed’s target annual rate of 2 percent. However, he cautioned against thinking that the disinflation trend would lead to a swift action to decrease interest rates.

“The data overall suggest that we are in the final mile of the marathon of getting PCE inflation back down to our target annual rate of 2 percent. However, as anyone who has ever run a marathon can tell you, the final mile is often the hardest,” Harker said. “I do believe we may be near the point where we can adjust the policy rate downward. But when we will actually arrive at that point, I cannot yet say.”

Harker also addressed the issue of the Federal Reserve’s balance sheet normalization, telling the audience that discussions on slowing the rate of reducing the size of the Fed’s balance sheet would begin with the March meeting.