Stable jobs, sticky inflation — the Fed stays cautious and data-dependent.

Summary:

• President and CEO of the Federal Reserve Bank of Cleveland Beth Hammack says unemployment appears to be stabilising.

• Labour market described as broadly in balance.

• Inflation remains above target and “still too high.”

• Consumer spending holding up, led by higher-income households.

• Fed’s focus remains firmly on returning inflation to 2%.

Federal Reserve official, President and CEO of the Federal Reserve Bank of Cleveland, Beth Hammack reiterated a steady but firm message, signalling little shift in the central bank’s stance as policymakers weigh the next move in rates. Her message was the same as when she spoke the previous day.

Hammack said the unemployment rate appears to be stabilising and characterised the labour market as broadly in balance, with the latest data reinforcing that view. The comments suggest the Fed sees limited immediate risk of labour market deterioration, reducing urgency for rate cuts on employment grounds.

At the same time, she stressed inflation remains too high and emphasised the importance of returning price growth to the Fed’s 2% target. The tone underscores that policymakers are not yet convinced inflation pressures have been fully tamed.

Hammack also noted that consumer spending continues to hold up, driven disproportionately by higher-income households. That dynamic may help explain why overall demand has remained resilient despite restrictive policy settings.

Taken together, the remarks point to a Federal Reserve that is comfortable with current labour market conditions but not prepared to declare victory on inflation. The message aligns with other recent commentary from Fed officials that policy needs to remain sufficiently restrictive until inflation is firmly on a sustainable path back to target.