Atlanta Fed President Highlights Inflation as Major Economic Risk

2025-11-13 economy

Atlanta, Thursday, 13 November 2025.
Raphael Bostic, President of the Federal Reserve Bank of Atlanta, stresses that inflation remains a significant threat, advocating for steady interest rates until inflation trends towards the 2% target.

Bostic’s Stance on Inflation and Interest Rates

Raphael Bostic, President of the Federal Reserve Bank of Atlanta, emphasized the persistent threat of inflation during his speech at the Atlanta Economics Club on November 12, 2025. He underscored that inflation remains above the Federal Reserve’s 2% target, a situation that has persisted for nearly five years. Consequently, Bostic advocates for maintaining the current interest rates until there is ‘clear evidence’ of inflation moving back towards the target [1][2].

Economic Challenges and Policy Implications

Bostic highlighted the dual challenges facing the Federal Reserve: achieving price stability and sustaining maximum employment. The labor market is showing signs of slowing growth, with monthly employment growth averaging just 29,000 in the three months leading up to August 2025 [1][3]. Despite this, Bostic pointed out that the risk of ongoing inflation is more pressing than the signals from the labor market, which he described as ambiguous [4].

Inflation Expectations and Economic Outlook

Forward-looking indicators, including surveys from the Federal Reserve Bank of Atlanta’s Economic Survey Research Center, suggest that inflation is unlikely to decline significantly in the near future. Firms expect to continue raising prices well into 2026, with expectations for price growth significantly exceeding 2% [1]. This outlook raises concerns about the potential for inflation expectations to drift upward, potentially necessitating higher unemployment to bring inflation back to target levels [3][5].

Bostic’s Retirement and Future Implications

In addition to discussing economic policy, Bostic announced his intention to retire at the end of February 2026, an unexpected move that opens a seat on the Federal Reserve’s interest-rate setting committee. His departure comes amid President Donald Trump’s push for greater influence over the Federal Reserve, including potential changes in leadership [6][7]. Bostic’s tenure has been marked by a focus on economic equity and social justice, alongside his hawkish stance on inflation [8].

Sources

inflation monetary policy