Chicago Fed President Austan Goolsbee says the progress the central bank had been making in bringing down inflation has "stalled." As a result, he thinks it "makes sense" to wait on rate cuts.

In remarks prepared for a speech before the Society for Advancing Business Editing and Writing's annual conference, Goolsbee says "So far in 2024, that progress on inflation has stalled. You never want to make too much of any one month’s data, especially inflation, which is a noisy series, but after three months of this, it can’t be dismissed."

Goolsbee's pivot is notable given that he has been one of the more dovish members of the Federal Reserve.

Yahoo Finance Federal Reserve Reporter Jennifer Schonberger reports the details.

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This post was written by Stephanie Mikulich.

Video Transcript

SEANA SMITH: Well, we've got breaking news. Fresh Fed speak coming out just moments ago, Chicago Fed President Austan Goolsbee pivoting his outlook for rate cuts. Goolsbee now saying it makes sense to wait. Let's get Yahoo Finance's Jennifer Schonberger joining us now with the details on that. Hi Jen.

JENNIFER SCHONBERGER: Hey Seana. That's right. Chicago Fed President Austan Goolsbee speaking right now in Chicago, saying that he believes progress on inflation has stalled, and that the Fed should wait and gain further clarity before moving to cut rates.

In prepared remarks at a conference at the Society for Advancing Business Editing and Writers, Goolsbee says, quote, "Progress on inflation has stalled. You never want to make too much of any one month's data, especially inflation, which is a noisy series, but after three months of this, it can't be dismissed." He went on to say, "Right now, it makes sense to wait and get more clarity before moving."

Seana, this, of course, a shift from what Goolsbee told me in an interview just after the Fed's last policy meeting when he expected three rate cuts at some point this year. He's particularly worried about housing inflation. He says that's been stickier than thought, has been slower to come down. He thought it would have been coming down by this point. And if that doesn't start coming down, he thinks that the path to 2% inflation will be much bumpier than thought.

Goolsbee, the fourth Fed official just this week to make a hawkish pivot. This, of course, coming on the back of a third straight month of hotter-than-expected inflation data when it comes to the consumer price index. We will get a reading on the Fed's preferred inflation gauge, the personal consumption expenditures index next Friday.

Goolsbee's comments mark the last from Fed officials before the blackout period, which begins tomorrow before the Fed's policy meeting on April 30 and May 1, where they are expected to hold rates steady. Again, Seana, the news here Austan Goolsbee from the Chicago Federal Reserve says progress on inflation has stalled, and that he believes the Fed should wait to gain more clarity before moving.

SEANA SMITH: All right, Jen. Thanks so much for bringing us that. Obviously, we're taking a look at reaction here to the markets. Not much of a reaction here at least initially. You're looking at the S&P and the NASDAQ, still both in negative territory. The Dow off the highs of the day, still up, though, about 170.