Fed's Powell: 4.2% Unemployment Rate Is Not a Bad Number

On August 15th, as reported by CNBC, David Zervos, the Chief Market Strategist at JPMorgan and a potential Fed chair, stated that Federal Reserve officials should not be frightened by the higher-than-expected potential inflationary pressures indicated by the July Producer Price Index. Instead, he argued that the Fed should take proactive accommodative measures at present to prevent a slowdown in the labor market, which would effectively help create more than 1 million jobs. Over the past three Fed meetings, Zervos has continuously advocated for a 0.5 percentage point cut in the federal funds rate, and he reiterated this stance in the interview. "I definitely still hold the same view. I think there is a very reasonable and compelling narrative that indicates monetary policy is restrictive. Overall, I don't see any reason to change that view."