Patrick T. Harker, president and CEO of the Federal Reserve Bank of Philadelphia, addressed the Philadelphia Business Journal’s State of the Economy forum on Aug. 8, indicating that in light of recent economic data and discussions with leaders across the Third District, he believes the time may have arrived to maintain steady interest rates and allow prior monetary policy measures to continue their impact with a focus on reducing inflation, according to a press release.
"Absent any alarming new data between now and mid-September, I believe we may be at the point where we can be patient and hold rates steady and let the monetary policy actions we have taken do their work," Harker said.
Harker asserted that he believes the time may be right to maintain interest rates at their current levels and let earlier monetary policy efforts continue to decrease inflation in light of recent economic data as well as the conversations he has had with banking and other leaders throughout the Third District.
"We'll need to stay there for a while if we reach the point where we can maintain our position," Harker said. "I do see us on the flight path to the gentle landing we all aspire for and that has proven rather elusive in the past."
Harker also presented a generally favorable assessment of the state of the Philadelphia region's economy, highlighting the upbeat outlook of business owners, rising numbers in important indices and the complete reversal of job losses caused by the epidemic. He did voice his worries regarding the impending start of federal student loan payments and commercial real estate.
"I do believe we are poised to come out from under the pressure of inflation in good condition, both nationally and right here in Philadelphia and the region," Harker said. "Overall, I believe that the resilience we've seen in our economy will continue."
